DOLE PHILIPPINES, INC. v. COMMISSIONER OF INTERNAL REVENUE

REPUBLIC OF THE PHILIPPINES COURT OF TAX APPEALS QUEZON CITY SPECIAL SECOND DIVISION DOLE PHILIPPINES, INC., CTA CASE NO. 10315 Petitioner, Members: -versus- DEL ROSARIO , P.J. ,� BACORRO-VILLENA, Acting Chairperson, and CUI-DAVID, JJ. fl"1r , COMMISSIONER OF Promulgated: l.j:~ INTERNAL REVENUE, AUG 3O2014 Respondent. ){- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - DECISION CUI-DAVID, J.: Before this Court is a Petition for Review filed on August 20, 2020, by petitioner Dole Philippines, Inc., praying that the Court renders judgment ordering respondent Commissioner of Internal Revenue to refund petitioner the aggregate amount of P1 ,381,096,733.07, representing its eJ<cess and unutilized input value-added ta){ (VAT) attributable to its VAT zero-rated sales for the period April 1, 2018 to March 31, 2019.1 THE PARTIES Petitioner Dole Philippines, Inc. is a corporation duly organized and existing under and by virtue of the laws of the Philippines, with principal address at Cannery Site, Cannery, Polomolok, South Cotabato. 2 Its head office and branches throughout the Philippines are registered with the Bureau of v Internal Revenue (BIR). 3 ' Special Member per Memorandum dated Ju ne 21, 2024. 1 Statement of the Case, Pre-Trial Order, Docket - Vol. II, p. 7 18. 2 Par. 1, Jo int Stipul ation ofFacts and Issues (.J SFI), Docket - Vol. II, p. 675 . 3 Ex hibits "P-3", "P-3 - 1", "P-3-2", "P-3-3", "P-3-4", "P-3-5", "P-3-6", "P-3-7", "P-3-8", "P-3-9", "P-3-1 0", "P-3- 11 ", "P-3-1 2", "P-3-13 ", "P-3-1 4", "P-3- 15", "P-3- 16", "P-3 -1 7", "P-3-1 8", "P-3-1 9", "P-3-20", "P-3-21", "P-3- 22", "P-3-22", "P-3-23 ", "P-3-24", "P-3-25", "P-3-26", "P-3-27", "P-3-28", "P-3-29", and "P-3 -30", Docket- Vol. III, pp. 1325 to 136 1.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X------------------------------------------------------------------------------------------X Respondent Commissioner of Internal Revenue (CIR) is empowered to perform the duties of his office, including acting upon protest cases and approval of claims for refund or tax credit as provided by law and implementing regulations. 4 FACTUAL ANTECEDENTS On December 16, 2019, petitioner filed before the BIR- VAT Credit Audit Division (VCAD) an administrative claim for VAT refund in the total amount of P1,381,096,733.07, allegedly representing unutilized input taxes directly attributable and allocable to its VAT zero-rated sales as declared in its VAT returns, for the taxable period from April 1, 2018 to March 31, 2019.5 The Tax Verification Notice No. TVN 201800116184, dated December 16, 2019, was issued to petitioner, authorizing Revenue Officers (RO) Leo-Gibbs C. Tapiru, Dexter C. Bustillos, Ruth E. Jimenez, Jerome C. Manuncia, Estela G. Buenviaje, Ma. Cleofe T. Tasarra, Jonathan G. Simon, Michele Alonzo-Bucayu, Mary Ann B. Estaci9, and Marjorie C. Dioso of the VCAD to verify petitioner's supporting documents and/ or pertinent records relative to its claim for VAT refund, covering the above-stated taxable period.6 On July 16, 2020, petitioner received the decision of Commissioner Caesar R. Dulay (via the VAT Refund Notice dated February 20, 2020), 7 denying its claim for a tax refund. 8 PROCEEDINGS BEFORE THIS COURT Aggrieved, the present Petition of Review was filed on August 20, 2020.9 Within the extended time granted by the Court, 10 respondent posted his Answer on November 3, 2020.11 N/ 4 Par. 2, JSFJ, Docket- Vol. II, p. 675. 5 Par. 3, JSFI, Docket- Vol. II, pp. 675 to 676; Exhibit "P-47", Docket- Vol. III, pp. 1481 to 1492; and Exhibit "P- 46", Docket- Vol. III, p. 1480. 6 Par. 4, JSFI, Docket- Vol. II, p. 676. 7 Exhibit "54", Docket- Vol. III, pp. 1523 to 1525 ; and Exhibit "R-5 ", BIR Records, pp. 1354 to 1356. 8 Par. 5, JSFI, Docket - Vol. II, p. 676. 9 Docket- Vol. I, pp. 6 to 53. 10 Respondent's Motion for Extension of Time to File Answer dated October 2, 2020, Docket- Vol. I, pp. 248 to 251; and Resolution dated October 8, 2020, Docket- Vol. I, p. 254. 11 Docket- Vol. I, pp . 265 to 275.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x-------------------------------------------------------------------------------------- : ---x On December 4, 2020, respondent transmitted the BIR Records for this case, which consisted of two (2) folders numbered consecutively as pages 1 to 1363. 12 The Pre-Trial Conference was initially set for April 8, 2021,13 but was eventually reset to and held on February 8, 2022.1 4 Prior thereto, petitioner's Pre-Trial Briefwas filed on May 17, 2021; 15 while respondent's Pre-Trial Brief was submitted on May 20, 2021.16 On March 9, 2022, the parties submitted their Joint Stipulation of Facts and Issues, 17 which was admitted and approved by the Court in the Resolution dated March 17, 2022, 18 thereby deeming the termination of the Pre-Trial. The Pre-Trial Order dated April 1, 2022 was then issued. 19 ' The trial then ensued, with both parties presenting and offering their respective testimonial and documentary evidence. Petitioner offered the testimonies of the following individuals, namely: (1) Mr. Artjohn C. Guerra, Tax Manager of Dole Asia Company Ltd.; 2o and (2) Atty. Adan T. Delamide, 21 the Court-commissioned Independent Certified Public Accountant (ICPA).22 The Amended and Final Report of the ICPA was posted on June 30, 2022.23 Petitioner filed its Formal Offer of Evidence on October 25, 2022,24 to which respondent filed his Comment (On Petitioner's Formal Offer of Evidence) on November 3, 2022. 25 ~ 12 Docket- Vol. I, pp. 328 to 330. 13 Resolution dated November 19, 2020, Docket- Vol. I, pp. 279 to 281. 14 Notice of Resetting dated October 6, 2021 , Docket- Vol. II, p. 642; and Minutes of the hearing held on, and Order dated February 8, 2022, Docket- Vol. II, pp, 645 to 648. 15 Docket- Vol. I, pp. 333 to 360. 16 Docket- Vol. II, pp. 635 to 637. 17 Docket- Vol. II, pp. 675 to 701. 18 Docket- Vol. II, pp. 715 to 716. 19 Docket- Vol. II, pp. 718 to 730. 20 Exhibit "P-58", Docket- Vol. II, pp. 750 to 782 ; and Minutes of the hearing held on, and Order dated, May 12, 2022, Docket- Vol. II, pp. I019 to I020. 21 Exhibit "P-216", Docket - Vol. III, pp. 1145 to 1202; and Minutes of the hearing held on, and Order dated, September 29, 2022, Docket- Vol. III, pp. 1269 to 1271. 22 Oath of Commission dated April26, 2022, Docket - Vol. II , p. 743; and Minutes of the hearing held on, and Order dated, April 26, 2022, Docket- Vol. II , pp. 742, and 744 to 745, respectively . 23 Exhibit " P-215", Docket- Vol. III, pp. I077 to 1132. 24 Docket- Vol. Jll, pp. 1279 to 1305. 25 Docket- Vol. III, pp. 1528 to 1530.

DECISION CTA Case No . 103 15 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 4 of65 X---------------- --- ---- ---- --- --- ----- -- ---- ------------- ----- --- -- ------- ---- --- ----- --- -X In the Resolution dated January 25, 2023,26 the Court partly admitted petitioner's offered exhibits. Consequently, on February 17, 2023, petitioner filed a Motion for Partial Reconsideration to the Resolution dated January 25, 2023,27 praying that this Court admit the denied exhibits. Thereafter, respondent filed his Comment/Opposition on March 14, 2023.28 For his part, respondent offered the testimonies of ROs Leo-Gibbs C. Tapiru29 and Junelle Aira C. Salamanca.3o Respondent filed his Formal Offer of Evidence on February 13, 2023 , 31 to which petitioner filed its Comment/ Opposition (To the Respondent's Formal Offer of Evidence) on February 21 , 2023. 32 In the Resolution dated April 18, 2023, 33 the Court partially granted petitioner's Motion for Partial Reconsideration and admitted Exhibit "P-6." However, the Court still denied the admission o,f certain exhibits because they were not found in the records. In the same Resolution, the Court admitted all respondent's offered exhibits. On May 22, 2023, petitioner filed its Memorandum;34 while on May 24 , 2023, 35 respondent submitted a Manifestation stating that he would adopt his Answer as his Memorandum. On May 26, 2023, the present case was considered submitted for decision. 36 THE ISSUE As stipulated by the parties, the sole issue for this Court's resolution is as follows : ~ 26 Docket- Vo l. IV, pp. 1538 to 1557. 27 Docket- Vo l. IV, pp. 1567 to 1592. 28 Docket- Vol. IV, pp. 1621 to I622. 29 Ex hibit "R-6", Docket- Vol. I, pp. 294 to 297 ; and Min utes of the hearing held on, and Order dated, February 2, 2023 , Docket- Vol. IV, p. 1558. 30 Exhibit "R-7", Docket - Vol. I, pp. 310 to 3 15; and Minutes of the hearing held on, and Order dated, February 2, 2023 , Docket - Vol. IV, p. 1558. 31 Docket - Vo l. IV, pp. 156 1 to 1565. 32 Docket - Vo l. IV, pp. 16 14 to 1615. 33 Docket- Vol. IV, pp. 1629 to 1647. 34 Docket- Vo l. IV, pp. 1648 to 1723 . 35 Docket- Vo l. IV, pp. 1725 to 1727. 36 Reso lution dated May 26, 2023 , Docket- Vo l. IV, p. 1729 .

DECISION CTA Case No . 10315 Dole Philippines, Inc . v. Commissioner of Internal Revenue Page 5 of65 X--- -- --- --- ----- -- ---- ---- ------------- ---- -- ------ ---- ---- -- --- --- -- ----- ----- ------ ---- -X "WHETHER PETITIONER IS ENTITLED TO THE CLAIM FOR REFUND OF THE EXCESS AND UNUTILIZED INPUT VALUE ADDED TAX (VAT) ALLOCABLE/ATTRIBUTABLE TO ITS VAT ZERO RATED SALES FOR THE PERIOD FROM APRIL 1, 2018 TO MARCH 31 , 2019 IN THE AMOUNT OF ONE BILLION, THREE HUNDRED EIGHTY-ONE MILLION, NINETY-SIX THOUSAND, SEVEN HUNDRED THIRTY- THREE PESOS AND SEVEN CENTAVOS (P1 ,381 ,096,733.07). "37 Petitioner's arguments: Petitioner argues that its claim for a tax refund should be granted because all the necessary elements are present. As such, its present judicial claim for a tax refund in the amount ofP1,381 ,096,733.07 should be granted. Respondent's counter-arguments: Respondent contends that the Court has no jurisdiction over the case and that the denial of petitioner's claim for refund in the amount of P1 ,381 ,096,733.07 is proper as it failed to comply with the mandatory requirements for claiming a tax refund or credit. THE COURT'S RULING The present Petition for Review is partly meritorious. The Court has jurisdiction over the present case. Respondent alleges that petitioner admitted ' receiving the VAT Refund Notice denying its claim for a tax refund on July 16, 2020. Citing Section 112 (C) of the National Internal Revenue Code (NIRC) of 1997, as amended by Republic Act (RA) No. 10963, the Tax Reform for Acceleration and Inclusion (TRAIN) Law, 38 respondent claims that petitioner had thirty (30) days , or until August 15, 2020, to elevate the v 37 Par. B, JSFI, Docket - Vol. II, p. 676. 38 AN ACT AMENDING SECTIONS 5, 6, 24, 25, 27, 3 I, 32, 33 , 34, 5 1, 52, 56, 57, 58, 74, 79, 84, 86, 90, 9 1, 97, 99, 100, 101 , 106, 107, 108, 109, 11 0, 11 2, 11 4, I 16, 127, 128, 129, 145, 148, 149, 15 1, 155, 17 1, 174, 175, 177, 178, 179, 180, 181, 182, 183, 186, 188, 189, 190, 19 1, 192, 193, 194, 195 , 196, 197, 232, 236, 237, 249, 254, 264, 269, AN D 288 ; CREATING NEW SECTIONS 51-A, 148-A, 150-A, 150-B, 237-A, 264-A, 264-B, AND 265-A; AN D REPEALING SECTIONS 35, 62, AN D 89; ALL UN DER REPUBLIC ACT 8424, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND FOR OTHER PURPOSES .

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X----------- ------------------------ --------- --- ---- ------------------------------ ---------X denial of its claim to this Court. Respondent maintains that petitioner filed the instant Petition for Review on August 20, 2020, which is five (5) days beyond the period prescribed under Section 112 (C); thus, this Court has no jurisdiction over the subject matter of the present case. 39 The Court disagrees with respondent. Section 112 of the NIRC of 1997, as amended by the TRAIN Law,4o provides, in part, as follows: "SEC. 112. Refunds or Tax Credits ofInput Tax. - (A) Zero-Rated or Effectively Zero-Rated Sales. - Any VAT-registered person, whose sales are zero-rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when the sales were made, apply for the issuance of a tax credit certificate or refu:pd of creditable input tax due or paid attributable to such sales XXX XXX XXX XXX (C) Period within which Refund ofInput Taxes shall be Made.- In proper cases, the Commissioner shall grant a refund for creditable input taxes within ninety (90) days from the date of submission of the official receipts or invoices and other documents in support of the application filed in accordance with Subsections (A) and (B) hereof: Provided} That should the Commissioner find that the grant of refund is not proper, the Commissioner must state in writing the legal and factual basis for the denial. In case of full or partial denial of the claim for tax refund, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim, appeal the decision with the Court of Tax Appeals: Provided} however, That failure on the part of any official, agent, or employee of the BIR to act on the application within the ninety (90)-day period shall be punishable under Section 269 of this Code." [Emphasis supplied] v 39 Answer, Docket - Vo l. I, pp. 266 to 267. 40 AN ACT AMENDING SECTIONS 5, 6, 24, 25, 27, 3 1, 32, 33 , 34, 51 , 52, 56, 57, 58, 74, 79, 84, 86, 90, 91 , 97, 99, 1 0~ 101 , 10~ 107, 1 0~ 10~ II ~ 11 2, II ~ 11 6, 127, 128, 1 2~ 145, 148, 1 4~ 151 , 15 5, 17 1, 174, 175, 1 7~ 178, 1 7~ 180, 18 1, 182, 183, 186, 188, 1 8~ 190, 19 1, 192, 193 , 194 , 195, 196, 1 9~2 3 2 , 23~237 , 24~2 5 4 , 26~ 269, AN D 288 ; CREATING NEW SECTIONS 51-A, 148-A, 150-A, 150-B, 237-A, 264-A, 264-B, AND 265-A; AN D REPEALING SECTIONS 35 , 62, AND 89; ALL UNDER REPUBLIC ACT 8424, OTHERWISE KNOWN AS THE NAT IONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND FOR OTHER PURPO SES .

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 7 of65 x------------------- ------ -------- --------- ---------- --- -------------------- ------- --------x Based on the foregoing, a VAT-registered . taxpayer claiming a tax refund or credit of excess and unutilized input VAT may file an administrative claim within two (2) years from the close of the taxable quarter when the sales were made; and a judicial claim within 30 days from receipt of respondent's decision denying the claim. The present claim covers the taxable period from April 1, 2018 to March 31, 2019. Counting two (2) years from the close of the taxable quarters, petitioner had until the following dates to file its administrative claim: Period Covered Close ofthe Last Day to File 1st Quarter Taxable Quarter Administrative Claim (April 1 to June 30, 20 18) June 30, 2018 June 30, 2020 2nd Quarter September 30, 2018 September 30, 2020 (July 1 to September 30, 2018) December 31, 2018 3rct Quarter ' March 31, 2019 (October 1 to December 31, December 31, 2020 2018) March 31, 2021 4th Quarter (January 1 to March 31 , 2019) Hence, petitioner's administrative claim for refund was timely filed on December 16, 2019.41 Correspondingly, from filing petitioner's administrative claim for refund on December 16, 2019, respondent had ninety (90) days, or until March 15, 2020 , to decide on the claim. While respondent's VAT Refund Notice denying petitioner's claim was allegedly issued on February 20, 2020, within the 90-day period, it was received by petitioner only on July 16, 2020. 42 As such, petitioner had thirty (30) days from July 16, 2020 , or until August 15, 2020,43 to app((al before this Court. However, due to the imposition of Modified Enhanced Community Quarantine (MECQ) in Metro Manila, the Supreme Court issued Administrative Circular No. 43A-2020 , suspending the reglementary periods for the filing of petitions , appeals, and other court submissions from August 4 to 18, 2020, and ordering their resumption on August 19, 2020.44 v 4 1 Exhibits "P-46" and "P-47'', Docket- Vol. III, pp. 1480 to 1492. 42 Exhi bit "54", Docket- Vo l. III, pp. 1523 to 1525; and Ex hibi t "R-5", BIR Records, pp. 1354 to 1356. 43 August 15, 2020 (30'h day) fe ll on Saturday . 44 Supreme Court Adm inistrative Circu lar No. 43A-2020 dated August 3, 2020.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 8 of65 X- ------- --- ---- ---- -- ------------------------------ -- ----------------------------- ----- ---X Since August 19, 2020 was declared a special non-working holiday (Quezon City Day) in Quezon City where this Court sits, the filing of the present Petition for Review on the following working day, August 20, 2020,45 was well within the adjusted reglementary period. The Court notes that the filing of the Petition for Review on August 20, 2020 was beyond the 90(previously 120)+30- day period. Records reveal that as of March 15, 2020, the end of ninety (90) days, petitioner had not received a decision on the refund claim, nor had it filed a petition for review within thirty (30) days from March 15, 2020. While respondent did not question the filing of the Petition for Review after the 90+30-day period, the Court finds it necessary to discuss, for the guidance of the bench and bar, that the Petition for Review was, nevertheless, timely filed. Section 112 (C) of the NIRC of 1997, as amended, governs the filing of a judicial claim for refund or tax credit of input VAT. Before the enactment of TRAIN Law, Section 112 (C) reads: "SEC. 112. Refunds or Tax Credits ofInput Tax.- XXX (C) Period within Which Refund or Tax Credit of Input Taxes shall be Made. - In proper cases, the Commissioner shall grant a refund or issue the tax credit certificate for creditable input taxes within one hundred twenty (120) days from the date of submission of complete documents in support of the application filed in accordance with Subsection (A). In case of full or partial denial of the claim for tax refund or tax credit, or the failure on the part'of the Commissioner to act on the application within the period prescribed above , the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim or after the expiration of the one hundred twenty day-period, appeal the decision or the unacted claim with the Court of Tax Appeals." [Emphasis supplied] ~ 45 Docket- Vol. I, pp. 6 to 53 .

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 9 of65 x------------- -- --- ------ --------- ---------------------------- -------------------- ---------x In construing the afore quoted provision, the Supreme Court opined, in Taihei Alltech Construction (Phil.), Inc. v. Commissioner ofInternal Revenue (Taihei}, 46 that th~ taxpayer can file an appeal in one of two (2) ways: (1) file the judicial claim within 30 days after the Commissioner denies the claim within the 120-day period, OR (2) file the judicial claim within 30 days from the expiration of the 120-day period if the Commissioner does not act within the 120 days. In Taihei, taxpayers were reminded that when the 120 days lapse and there is inaction on the part of the CIR, they must no longer wait for it to come up with a decision thereafter. The CIR's inaction is the decision itself. It is already a denial of the refund claim. Thus, the taxpayer must file an appeal within thirty (30) days from the lapse of the 120- day waiting period.47 In the case of Silicon Philippines, Inc. v. Commissioner of Internal Revenue (Silicon) cited in the Taihei case, the Supreme Court emphasized that a judicial claim for refund shall be filed within thirty (30) days after the receipt of the CIR's decision/ruling OR after the expiration of the 120-day period, "whichever is sooner." 48 The judicial claim shall be filed within a period of 30 days after the receipt of respondent's decision or ruling or after the expiration of the 120-day period, whichever is sooner. Aside from a specific exception to the mandatory and jurisdictional nature of the periods provided by the law, any claim filed in a period less than or beyond the 120+30 days provided by the NIRC is outside the jurisdiction of the CTA. [Emphasis supplied] The Supreme Court said in Taihei that the post facto denial of the administrative claim is irrelevant, as the CIR's inaction for 120 days is already considered a "deemed denial" of the administrative claim for refund. Without a timely appeal, the "deemed denial" becomes final and v u n a p p e a l a b l e . 49 46 G.R. No. 258791 , December 7, 2022. 47 Taihei Alltech Construction (Phil.), Inc. v. Commissioner of Internal Revenue, id. , citing Rohm Apollo Semiconductor ?hils. v. Commissioner of Internal Revenue in Taihei Alltech Construction (Ph il.). Inc. v. Commissioner ofInternal Revenue, G.R. No. 168950, January 14, 2015. 48 !d. , citing Silicon Philippines, Inc. v. Comm issioner ofInternal Revenue, G.R. No. 182737, March 2, 20 16. 49 !d.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X-------------------- ---- -- -- --------------------------- --- --------------- -----------------X With the enactment of the TRAIN Law, Section 112(C) of the NIRC was amended to read as follows: "SEC. 112. Refunds or Tax Credits ofInput Tax.- XXX (C) Period within which Refund or Tax Credit of Input Taxes shall be Made. - In proper cases, the Commissioner shall grant a refund for creditable input taxes within ninety (90) days from the date of submission of the official receipts or invoices and� other documents in support of the application filed in accordance with Subsections (A) and (B) hereof: Provided, That should the Commissioner find that the grant of refund is not proper, the Commissioner must state in writing the legal and factual basis for the denial. In case of full or partial denial of the claim for tax refund, the taxpayer affected may, within thirty (30) days from the receipt of the decision denying the claim, appeal the decision with the Court of Tax Appeals: Provided, however, That failure on the part of any official, agent, or employee of the BIR to act on the application within ninety (90) days period shall be punishable under Section 269 of this Code. " [Emphasis supplied] As provided in Section 112 (C) above, the period for the CIR to act on the administrative claim for refund was reduced from 120 days to 90 days, and specific phrases relative to the "inaction of the CIR" have been deleted. As currently worded, Section 112(C) does not anymore give the taxpayer the right to appeal the "inaction of the CIR" within thirty (30) days following the lapse of the 120(now 90)- day period. Given the deletion or removal of the phrases "or the failure on the part of the Commissioner to act on the application within the period prescribed above' and "or after the expiration ofthe one hundred twenty day-period," the 30- day period to appeal to the CTA, pursuant to the TRAIN law, can be made under only one circumstance, that is, from receipt by the taxpayer of the CIR's decision denying the refund claim - whether the receipt was before or after the lapse of the 90-day waiting period. Indeed, the principle behind the Silicon case, as cited in Taihei, that "any claim filed in a period less than or beyond the 120+30 days provided by the NIRC is outside the jurisdiction of the CTA" - no longer applies to cases ~

DECISION CTA Case No. 10315 Dole Philippines, Inc . v. Commissioner of Internal Revenue x------- ---------- -------------------- ---- -- ---- --------- ----------------------------------x governed by the TRAIN Law, considering the deletion of the phrases relative to the CIR's inaction on the claim after 120 (now 90) days. Moreover, Section 4.112-1 (d) of Revenue Regulations (RR) No. 16-2005, 5o as amended by RR No. 26-2018,51 explicitly provides that the taxpayer affected may appeal the decision to the CTA within thirty (30) days from receipt of the decision denying the claim to wit: "SEC. 4.112-1. Claims for Refund/Credit of Input Tax. -xxx XXX XXX XXX (d) Period within which refund/ credit of input taxes shall be made XXX XXX XXX The 90-day period to process and decide shall ,start from the filing of the claim up to the release of the payment of the VAT refund: Provided, That, the claim/ application is considered to have been filed only upon submission of the official receipts or invoices and other documents in support of the application as prescribed under pertinent revenue Issuances. In case of full or partial denial of the claim for tax refund, the taxpayer affected, may, within thirty (30) days from the receipt of the decision denying the claim, appeal the decision with the Court of Tax Appeals (CTA): Provided, that failure on the part of any official, agent or employee of the BIR to act on the application within the ninety (90)-day period shall be punishable under Section 269 of the Tax Code, as amended. Provided, further, That, in the event that the 90-day period has lapsed without having the refund released to the taxpayer-claimant, the VAT refund claim may still continue to be processed administratively. Provided however, That the BIR of~icial, agent or employee who was found to have deliberately caused the delay in the processing of the VAT refund claim may be subjected to penalties imposed under said section. v x x x " [Emphasis supplied] 50 SUBJECT: Consolidated Value-Added Tax Regulations of2005 . 51 SUBJECT: Amends Certain Provisions of RR No. 13-20 18 to Im plement the 90-Day Processi ng ofC1ai m for VAT Refund under Section 112 (C) of the Tax Code of 1997, as Amended by Republic Act (R.A.) No. 10963 , Otherwise Known as the Tax Refo rm for Acceleration and Inclusion or TRAIN.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue ){-------------------------------- ----------------------------- --------- --- -----------------){ Under the cited provision, if the 90-day period lapses without the refund being released to the claimant, the BIR may continue to process the refund claim. Furthermore, the BIR official, agent, or employee found to have deliberately caused the delay in processing the VAT refund claim may be subjected to penalties. Clearly, Section 112 of the NIRC of 1997, as amended, and Section 4.112-1(d) or RR No. 16-2005, as amended, contemplate the possibility that the BIR may act and issue a decision on the refund claim after the lapse of the 90-day period. In such cases , the taxpayer may file an appeal with this Court within thirty (30) days from receipt of the decision or ruling. Nonetheless, notwithstanding the amendment, a taxpayer may still elevate the CIR's inaction should he desire to do so, pursuant to Section 7(a)(2), in relation to Section 11 of RA No. 112552, as amended by RA No. 928253, which provides that the CTA has jurisdiction not only over CIR's decisions but also his inactions on refund claims where the law provides a "specific period of action." Notably, Section 86 of the TRAIN Law,54 the repealing clause, which includes a comprehensive list of repealed laws, does not mention RA No. 1125 nor RA No. 9282. It has been consistently held that "on the presumption that whenever the legislature enacts a provision it has in mind the previous statutes relating to the same subject matter, it is held that in the absence of any express repeal or amendment therein, the new provision was enacted in accord with the legislative policy embodied in those prior statutes, and they all should be construed together. 55 Applying the foregoing, in enacting the TRAIN Law, the legislature is presumed to have in mind the 'pertinent provisions of RA No. 9282 concerning the CTA's jurisdiction OFTAX APPEALS ~ 53 AN ACT EXPANDING THE JU RISDI CTION OF THE COURT OF TAX APPEALS (CTA), ELEVATING ITS RANK TO THE LEVEL OF A COLLEGIATE COURT WITH SPECIAL JURIS DICTION AND ENLARGING ITS MEMBERSHIP, AMENDING FOR THE PURPOSE CERTAIN SECTIONS OR REPUBLIC ACT NO. 11 25, AS AMENDED, OTHERWISE KNOWN AS THE LAW CREATING THE COURT OF TAX APPEALS, AND FOR OTHER PURPOSES. 54 SECTION 86. Repealing Clause. - The fo llowing laws or provisions of laws are hereby repealed, and the persons and/or transactions affected herein are made subject to the VAT provision of Title IV of the NI RC, as amended: ... Tax Reform fo r Acceleration and Inclusion (TRAIN), Republic Act No. I0963, December 19, 20 17. 55 Garcia v. Tolentino, G.R. Nos. 153810 & 167297, August 12, 20 15 .

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X-------------------------------- ------------- --- ------------------------------------------X to review by appeal the inaction of the CIR in cases involving disputed assessments, refunds, or other matters arising under the NIRC. Thus, in the absence of its express repeal, the TRAIN Law is deemed enacted in accordance. with the legislative policy embodied in those prior laws, including RA No. 9282. Section 7(a)(1) and (2) and Section 11 of RA No. 112556 , as amended by RA No. 928257 , which have not been repealed by the TRAIN Law, are quoted as follows: SEC. 7. Jurisdiction.- The CTA shall exercise: (a) Exclusive appellate jurisdiction to review by appeal, as herein provided: (1) Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue; (2) Inaction by the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of internal revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue, where the National Internal Revenue Code provides a specific period of action, in which case the inaction shall be deemed �a denial; XXX XXX XXX SEC. 11. Who May Appeal; Mode of Appeal; Effect of Appeal. - Any party adversely affected by a decision, ruling, or inaction of the Commissioner of Internal Revenue ... may file an appeal with the CTA within thirty (30) days after the receipt of such decision or ruling or after the expiration of the period fixed by law for actiqn as referred to in Section 7(a)(2) herein. Appeal shall be made by filing a petition for review under a procedure analogous to that provided for under Rule 42 of the 1997 Rules of Civil Procedure with the CTA within thirty (30) days from the receipt of the decision or ruling or in the case of inaction as herein provided, from . t / the expiration of the period fixed by law to act thereon . 56 Supra at note 52. 57 Supra at note 53.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x---------------- ------ -- ---- -- ---- ---------- --- -- ---- ----- -- ---------------- --------- --- --x A Division of the CTA shall hear the appeal: xxx [Emphasis supplied] Indeed, despite the amendments introduced by the TRAIN Law, the CTA retains its appellate jurisdiction to review the inaction of the CIR. Regarding the decision of the CIR, it is not required that it be received before the lapse of the "specific period of action," which is ninety (90) days. Therefore, a judicial claim filed within thirty (30) days from receipt of a decision rendered or received beyond the 90-day period is valid. In summary, under the present text of Section 112 (C) of the NIRC of 1997, as amended by the TRAIN Law, and Sections 7(a)(2) and 11 of RA No. 1125, as amended by RA No. 9282 , a taxpayer adversely affected by a decision, ruling or inaction of the CIR may file an appeal as follows: (1) In case of full or partial denial of the tax refund claim within the 90-day period for the CIR to act, the affected taxpayer may appeal to this Court within 30 days from receipt of the decision denying the claim; (2) In case the 90-day period lapses without the taxpayer receiving a decision fully or partially denying the claim, the taxpayer may treat the inaction as a denial under Section 7 (a)(2) of RA No. 1125, as amended by RA No . 9282, and may appeal to this Court within 30 days from the lapse of the 90-day period; and (3) In case the taxpayer chooses to wait for the CIR's decision and receives a full or partial denial of the claim after the 90-day period has lapsed, the taxpayer may still file an appeal with this Court within 30 days from receipt of the decision, pursuant to the current wording of Section 112(C) of the NIRC of 1997, as amended. As previously discussed, petitioner received the VAT Refund Notice allegedly issued within the 90-day period on July 16, 2020. Counting thirty (30) days from that date, petitione~ had until August 15, 2020, to file a petition for review before this Court. However, the filing of petitions was suspended from August 4 to 18, 2020, and resumed on August 19, 2020, in accordance with Supreme Court Administrative Circular No. 43A-2020, dated August 3, 2020. Moreover, August 19, 2020 was a special non-working holiday. Hence, the filing of the instant Petition for Review on August 20, 2020, which coincided with the resumption of the filing of petitions, appeals, and other court submissions before this Court, was timely. ~

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x----- --------- ----- ----- --------- ---- ----- -- --- --- ----- ---------- ------------- ------ ---- --x Having settled that the Petition for Review was timely filed, the Court likewise rules that it has the requisite jurisdiction to take cognizance of this case under Section 3(a)(l), Rule 4 of RRCTA.ss Requisites for the grant of a refund or issuance of tax credit certificate of unutilized or excess input VAT attributable to zero- rated sales. Section 112(A) and (C) ofthe NIRC of 1997, as amended, provides: SEC. 112. Refunds or Tax Credits of Input Tax. - (A) Zero-rated or Effectively Zero-rated Sales. - Any VAT-registered person, whose sales are zero-rated or effectively zero-rated may, within two (2) years after the close of the taxable quarter when the sales were made, apply for the issuance of a tax credit certificate or refu:p.d of creditable input tax due or paid attributable to such sales, except transitional input tax, to the extent that such input tax has not been applied against output tax: Provided, however, That in the case of zero-rated sales under Section 106(A)(2)(a)(1) , (2) and (b) and Section 108 (B)(1) and (2), the acceptable foreign currency exchange proceeds thereof had been duly accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP): Provided, further, That where the taxpayer is engaged in zero-rated or effectively zero-rated sale and also in taxable or exempt sale of goods of properties or services, and the amount of creditable input tax due or paid cannot be directly and entirely attributed to any one of the transactions, it shall be allocated proportionately on the basis of the volume of sales. Provided, finally, That for a person making sales that are zero-rated under Section 108(B) (6), the input taxes shall be allocated ratably between his zero-rated and non-zero-rated sales. (B) ... (C) Period within which Refund or Tax Credit of Input tyt/ Taxes shall be Made. - In proper cases, the Commissioner shall grant a refund for creditable input taxes within ninety (90) days from the date of submission of the official receipts 58 Section 3. Cases Within the Jurisdiction of the Co urt in Divisions. - The Court in Divisions shall exercise: (a) Exclusive original or appellate jurisdiction to rev iew by appeal the fo llowing : ( I) Decisions of the Comm issioner of Intern al Revenue in cases involving xxx refunds of internal revenue taxes, XXX.

DECISION CTA Case No . 103 15 Dole Philippines, Inc. v. Commissioner of Internal Revenue X----- --- -- --------------------- ------ -- -- --- ---- -- --- --- ----- ------ --- -------- ------------X or invoices and other documents in support of the application filed in accordance with Subsections (A) and (B) hereof: Provided, That should the Commissioner find that the grant of refund is not proper, the Commissioner must state in writing the legal and factual basis for the denial. In case of full or partial denial of the claim fo~ tax refund, the taxpayer affected may, within thirty (30) day s from the receipt of the decision denying the claim, appeal the decision with the Court of Tax Appeals: Provided, however, That failure on the part of any official, agent, or employee of the BIR to act on the application within ninety (90) days period shall be punishable under Section 269 of this Code. As culled from jurisprudence, particularly Commissioner of Internal Revenue v. Toledo Power Co.,59 the requisites to successfully obtain a credit/refund ofunutilized or excess input VAT under Section 112 of the NIRC of 1997, as amended, are as follows: As to the timeliness of the filing of the administrative and judicial claims: 1. the claim is filed with the BIR within two (2) years 'after the close of the taxable quarter when the zero-rated or effectively zero-rated sales were made ;6o 2. in case of full or partial denial of the refund claim rendered within a period of ninety (90) days from the date of submission of the official receipts or invoices and other documents in support of the application, the judicial claim shall be filed with this Court within thirty (30) days from receipt of the decision. 5 1 With reference to the taxpayer's registration with the BIR: 3. the taxpayer is a VAT-registered person;62 In relation to the taxpayer's output VAT: 4. the taxpayer is engaged in zero-rated or effectively zero- v rated sales;63 59 G. R. Nos. 1951 75 & 199645, 10 August 20 15, 766 SCRA 20-33. 60 Intel Technology Philippines, Inc. v. Commissioner of Internal Revenue, G. R. No. 166732, April 27, 2007; San Roque Power Corporation v. Comm issioner of Internal Revenue, G.R. No. 180345, November 25, 2009; and A T&T Communications Services Philippines, Inc. v. Commissioner ofInternal Revenue, G.R. No. 182364, August 3, 201 0. 6 1 Refer to Energy Develop ment Corporation v. Commissioner of Internal Revenue, G.R. No. 203367, March 17, 202 1; Commissioner of Internal Revenue v. CE Casecnan Water and Energy Company, Inc., G.R. No. 212727, February I, 2023 ; and Commissioner ofInternal Revenue v. Vestas Services Philippines, Inc., G. R. No. 255085, March 29, 2023. 62 Intel Technology Philippines, Inc. v. Commissioner ofInternal Revenue, supra; San Roque Power Corporation v. Commissioner ofInternal Revenue, supra; and A T&T Communications Services Philippines, Inc. v. Commissioner ofInternal Revenue, supra. 63 !d.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x------- -------------- -- --------- ---- ------- ---- ----- ----- -------- -- ------ -- ---- -----------x 5. for zero-rated sales under Section 106(A)(2)(a)(l), (2) and (b) , and Section 108(B)(l) and (2), the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with BSP rules and regulations;64 As regards the taxpayer's input VAT being refunded: � 6. the input taxes are not transitional;6s 7 . the input taxes are due or paid;66 8. the input taxes claimed are attributable to zero-rated or effectively zero-rated sales. However, where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes shall be proportionately allocated on the basis of sales volume;67 and 9. the input taxes have not been applied against output taxes during and in the succeeding quarters .68 In addition, in claims for VAT refund/credit, applicants must satisfy the substantiation and invoicing requirements under the NIRC and other implementing rules and regulations 69 to determine the veracity of the taxpayer's claims.7� Moreover, compliance with all the VAT ,invoicing requirements provided by tax laws and regulations is mandatory. 7 1 Furthermore, it must be emphasized that in cases filed before this Court, which are litigated de novo, party-litigants must prove every minute aspect of their case. 72 Thus, petitioner must comply with the foregoing requisites and invoicing requirements. The absence of any of the said requisites is a valid ground to deny the refund claim. hi 64 !d. 65 !d. 66 Jd. 67 Intel Technology Philippines, Inc. v. Commissioner ofInternal Revenue, supra; and San Roque Power Corporation v. Comm issioner ofInternal Revenue, supra. 68 Intel Technology Philippines, Inc. v. Commissioner ofInternal Revenue, supra; San Roque Power Corporation v. Comm issioner ofInternal Revenue, supra; and AT&T Communications Services Philippines, Inc. v. Commissioner ofInternal Revenue, supra. ' 69 Team Energy Corporation v. Commissioner of Internal Revenue, et seq., G. R. Nos. 197663 and 197770, March 14, 2018. 70 Nippon Express (Philippines) Corporation v. Commissioner ofInternal Revenue, G. R. No. 19 1495, July 23, 20 18. 71 Eastern Telecommunications Philippines, Inc. v. Commissioner ofInternal Revenue, G. R. No. 183531 , March 25, 20 15 . 72 Edison (Bataa n) Cogeneration Corporation v. Commissioner of Internal Revenue, etseq., G. R. Nos. 201 665 and 20 1668, August 30, 20 17; Commissioner of Internal Revenue v. Ph ilippine National Bank, G. R. No. 180290, September 29, 20 14; Commissioner of Internal Revenue v. United Salvage and Towage (Phils.), Inc., G. R. No. 19751 5, July 2, 20 14; Dizon v. Court ofTax Appeals, et al. , G. R. No. 140944, Apri l 30, 2008; Atlas Consolidated Mining and Development Corporation v. Commissioner of Internal Revenue, G. R. No. 145526, March 16, 2007; an d Commissioner ofInternal Revenue v. Manila Mining Corporation, G. R. No . 153204, August 31,. 2005 .

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x-------------------------------------- ------ --------- ---- --- ------ ------------------------x First and second requisites: The administrative and judicial claims were timely filed. The first and second requisites have already been exhaustively discussed above. To reiterate, the Court finds that petitioner timely filed its administrative and judicial claims for a refund. Third requisite: Petitioner is a VAT-registered entity. The Certificate of Registration (BIR Form No. 2303) may be used to determine whether petitioner is VAT-registered. Anent the third requisite, it is undisputed that petitioner is a VAT-registered person/entity with Tax Identification No. (TIN) 000-428-573-000, as evidenced by BIR Certificates of Registration for its Head Office and branches.73 Thus, there is no question that petitioner showed compliance with the said requisite. Fourth and fifth requisites: Petitioner has zero-rated or effectively zero-rated sales but only in the amount of P36,499,857,975.17. The fourth and fifth requisites require that the taxpayer be engaged in zero-rated or effectively zero-rated sales, and for zero-rated sales under Sections 106(A)(2)(a)(1) and (3), and 108(B)( 1) and (2) of the NIRC of 1997, as amended, the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with Bangko Sentral ng Pilipinas (BSP) rules and regulations. In its Amended Quarterly VAT Returns for the period covering April 1, 20 18 to March 31, 20 19, petitioner reported total sales ofP39,600,679,515.70 which include vatable sales amounting to P2,539,658,198.47, zero-rated sales amounting ~ II ", " P-3-12", "P-3-13 ", " P-3-14", " P3--33-"1'5""P,-"3P-4-3"-'1"6P"-,3"-P5-''3' -"1P7-"3,-6""P'-3"-P1-83"-7, ""P' "-3P--139-8",""' "PP-3-3-2-90"",' "" PP--33--2110"" ,' " P-3- " P-3- 22", "P-3-22", "P-3-23 ", "P-3-24", " P-3-25", "P-3-26", "P-3-27", "P-3-28", " P-3-29", and " P-3-30", Docket- Vol. III, pp. 1325 to 1361.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x---------- -- ----- --- ---- --- --- ---- -- ----- ---- ---- --- ---- -- ------ -------- ----------- ------ -x to P36 ,533 ,275 ,020.59 and exempt sales amounting to P527,746,296.64, as shown below: Period Vatable Sales Zero Rated Sales Exempt Sales Total Covered p 428 ,259 ,954.73 p 8 ,660 ,656, 265 .05 p 110,066,861.07 p 9 , 198,983 ,080.85 1st 554 ,060 ,017.74 7 ,284 ,692 ,457.69 11 7 ,686 ,4 94.03 ' 7 ,956 ,438 ,969.46 Q u a r t e r7 4 2 nd 968,167,282 .26 10 ,202 ,383 ,488 .80 154, 117,379 .02 11 ,32 4 ,668 , 150 .08 Quarter75 589 ,170,943.74 10,385,542,809.05 145 ,875 ,562 .52 11 , 120 ,589 ,315 .31 3 rd P2,539,658, 198.47 P36,533,275,020.59 P527,746,296.64 P39,600,679,515.70 Q u a rt e r7 6 4 th Quart er77 Total Petitioner claims that it entered into a Sales Agreement78 with Dole Asia Holdings (DAH) Pte. Ltd., a non-r~sident foreign corporation (NRFC) established under the laws of Singapore and holding principal office thereat and the consideration for which was paid for and inwardly remitted in acceptable foreign currency and accounted for in accordance with the rules and regulations of the BSP.79 In addition, petitioner avers that its other clients for the period April 1, 2018 to March 31, 2019, include export- oriented entities that are either registered with the, Board of Investments (BOI) , Subic Bay Metropolitan Authority (SBMA), and Clark Development Corporation (CDC). Bo From the foregoing, petitioner has two (2) sources of zero-rated sales , i.e., (1) sales to NRFC doing business outside the Philippines; and, (2) sales to entities registered with Philippine Economic Zone Authority (PEZA), BOI, CDC, SBMA and other government entities, under Section 106(A)(2)(a)(l) and (5) of the NIRC of 1997, as amended. Based on the ICPA Report, petitioner's zero-rated sales can be classified as follows: \1 74 Exhibit "P-1 0", Docket - Vol. III, pp. 1420 to 142 1. 75 Exhibit "P-1 3", Docket - Vol. III, pp. 1426 to 1427. 76 Ex hi bit "P- 17", Docket - Vol. Ill, pp. 1434 to 1435. 77 Exhibit "P-20", Docket - Vo l. III, pp. 1440 to 1441. 78 Exhi bit "P-5", Docket - Vol. III, pp. 1393 to 1399. 79 Par. 6.7, Petition for Review, Docket- Vo l. I, pp. 17 to 18. 80 Par. 6. 18, Petition for Review, Docket- Vo l. I, p. 22.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 20 of65 X------------------------------------------------------------------------------------------X Registration Annexes Amount Amount Type to ICPA (in USD) Customer Name Report (in Pesos) I $ 686,411,805.64 I 528,199.96 I. Sales to NRFC (Direct Export Sales) I 3,167,049.24 1. Dole Asia NRFC Annexes $690,107,054.84 , Holdings (DAH) AA,AE, p 36,310,334,491 .67 Pte. Ltd. AG, AI, AC, AD,AH,AJ 2. Dole Thailand NRFC Annex AA 27,845,700.35 165,453,606.60 3. Itochu Metals NRFC Annex AA P36,503,633, 798.62 Corporation Total Direct Export Sales II. Sales registered with BOI, SBMA, and CDC (Considered Export Sales) 1. Century Pacific Agricultural BOI Annex AB P � 21,252,520 .02 Ventures, Inc. 2. General Tuna BOI Annex AB 4,461,530.88 Corporation 3. Philbest Canning BOI Annex AB 1,253,062.00 Corporation 4. Fresh Consumer BOI (DTI-Export Trade and Development Annex AF 2,558,520.00 Logistics, Inc. Act) 5. Gem Foods International, SBMA Annex AF $ 5,702 .50 296,620.57 Inc. 6 . Milbrae Exports, CDC Annex AF (181 ,030.00) Inc. Total Considered Export Sales $ 5,702.50 p 29,641,223.47 TOTAL ZERO-RATED SALES $686,417,508.14 P36,533,275,022.0981 As the table above shows, petitioner's sales to NRFCs include its sales to Dole Thailand and ltochu Metals Corporation, in addition to DAH Pte. Ltd. The relevant provision in determining whether petitioner's sales to the foregoing customers are subject to VAT at zero percent (0�/o) is Section 106(A)(2)(a)(l) and (5) of the NIRC of 1997, as amended, which reads: "SEC. 106. Value-Added Tax on Sale of Goods or Properties. - (A) Rate and Base of Tax. - xxx (2) The following sales by VAT-registered persons shall be subject to zero percent (0%) rate: (a) Export Sales.- The term 'export sales' means: ~ 81 The Court notes an unexplained discrepancy of Pl .50 between the !CPA Report and the decl ared zero-rated sales on the VAT return.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X------------------------------------------------------------------------------------------X (1) The sale and actual shipment of goods from the Philippines to a foreign country, irrespective of any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the goods so exported and paid for in acceptable foreign currency or its equivalent in goods or services, and accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas (BSP); XXX XXX XXX (5) Those considered export sales under Executive Order No. 226, otherwise known as the "Omnibus Investments Code of 1987', and other special laws." Relative thereto, Section 4.106-5 of RR No. 16-2005,82 as further amended by RR No. 13-2018,83 provides: "SEC. 4.106-5. Zero-Rated Sales of Goods or Properties. - xxx The following sales by VAT-registered persons shall be subject to zero percent (0%) rate: (a) Export Sales.- 'Export Sales' shall mean: (1) The sale and actual shipment of goods from the Philippines to a foreign country, irrespective of , any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the goods so exported, paid for in acceptable foreign currency or its equivalent in goods and services, and accounted for in accordance with the rules and regulation of the Bangko Sentral ng Pilipinas (BSP) ; XXX XXX XXX (4) Transactions considered export sales under Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987, and other special laws. 'Considered export sales under Executive Order No. 226' shall mean the Philippine port F.O.B. value determined from invoices, bills of lading, inward letters of credit, landing certificates, and other commercial documents, of export products exported directly by a registered export producer, or the net selling price of e4port products sold by a registered export producer to another export producer, or to an export trader that subsequently ty/ exports the same; Provided, That sales of export products 82 Supra at note 50. 83 Regulations Implementing the VAT Provisions under the RA No. I0963 , Further Amending RR No. 16-2005, as Amended, March 15, 2018.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 22 of65 X-------------------------------- ---------- -- -------------------- --------------------------X � to another producer or to an export trader shall only be deemed export sales when actually exported by the latter, as evidenced by landing certificates or similar commercial documents; Provided, further, That without actual exportation the following shall be considered constructively exported for purposes of these provisions: (1) sales to bonded manufacturing warehouses of export-oriented manufacturers; (2) sales to export processing zones; (3) sales to registered export traders operating bonded trading warehouses supplying raw materials in the manufacture of export products under guidelines to be set by the Board in consultation with the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC); (4) sales to diplomatic missions and other agencies and/ or instrumentalities granted tax immunities, of locally manufactured, assembled or repacked products whether paid for in foreign currency or not. For purposes of zero-rating, the export sales of registered export traders shall include commission income. The exportation of goods on consignment shall not be deemed export sales until the export products consigned are in fact sold by the consignee: and Provided, finally, that sales of goods, properties or services made by a VAT- registered supplier to a BOI-registered manufacturer j producer whose products are 100% exported are considered export sales. A certification to this effect must be issued by the Board of Investment (BOI) which shall be good for one year unless subsequently re- issued by the BOI." Moreover, petitioner must comply with the invoicing requirements under Section 113(A) and (B) of the NIRC of 1997, as amended, which provides that a VAT taxpayer shall, for every sale, barter or exchange of goods or properties, issue a VAT invoice or official receipt (OR) which must contain the following information: "SEC. 113. Invoicing and Accounting Requirements for VAT-Registered Persons. - (A) Invoicing Requirements. -A VAT-registered person shall issue: (1) A VAT invoice for every sale, barter or exchange of goods or properties; and (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. v

DECISION CTA Case No . 10315 Dole Philippines , Inc. v. Commissioner of Internal Revenue Page 23 of65 X-- -------- ----------- ------------------------------------------------------- --------------X (B) Information Contained in the VAT Invoice or VAT Official Receipt. - The following information shall be indicated in the VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT-registered person, followed by his taxpayer's identification number (TIN); (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the value-added tax: Provided) That: (a) The amount of the tax shall be shown as a separate item in the invoice or receipt; (b) If the sale is exempt from value-added tax, the term 'VAT-exempt sale' shall be written or printed prominently on the invoice or receipt; (c) If the sale is subject to zero percent (0%) value- added tax, the term 'zero-rated sale' shall be written or printed prominently on the invoice or receipt; (d) If the sale involves goods, properties or services some of which are subject to and some of which are VAT zero-rated or VAT-exempt, the invoice or receipt shall clearly indicate the breakdown of the sale price between its taxable, exempt and zero-rated components, and the calculation of the value-added tax on each portion of the sale shall be shown on the invoice or receipt: Provided, That the seller may issue separate invoices or receipts for the taxable, exempt, and zero-rated component of the sale. � (3) The date of transaction, quantity, unit cost and description of the goods or properties or nature of the service; and (4) In the case of sales in the amount of One thousand pesos (P1,000.00) or more where the sale or transfers is made to a VAT-registered person, the name, business style, if any, address and Taxpayer Identification Number (TIN) of the purchaser, customer, or client." [Emphasis supplied] The above provision is implemented by Section 4.113-1 of RR No. 16-2005, as amended, which reads: SEC. 4.113-1. Invoicing Requirements. - (A) A VAT-registered person shall issue:- (1) A VAT invoice for every sale, barter or exchange of goods or properties; and �

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 24 of65 X----------------- --------------------- ------------------------------------ ---- -- ------ -- --X (2) A VAT official receipt for every lease of goods or properties, and for every sale, barter or exchange of services. Only VAT-registered persons are required to print their TIN followed by the word 'VAT' in their invoice or official receipts. Said documents shall be considered as a "VAT Invoice" or "VAT official receipt" . All purchases covered by invoices/receipts other than VAT Invoice/VAT Official Receipts shall not give rise to any input tax. VAT invoice/official receipt shall be prepared at least in duplicate, the original to be given to the buyer and the duplicate to be retained by the seller as part of his accounting records. (B) Information contained in VAT invoice or VAT official receipt. - The following information shall be indicated in VAT invoice or VAT official receipt: (1) A statement that the seller is a VAT-registered person, followed by his TIN; (2) The total amount which the purchaser pays or is obligated to pay to the seller with the indication that such amount includes the VAT; Provided, That: (a) The amount of tax shall be shown as a separate item in the invoice or receipt; (b) If the sale is exempt from VAT, the term "VAT- exempt sale" shall be written or printed prominently on the invoice or receipt; (c) If the sale is subject to zero percent (0%) VAT, the term "zero-rated sale" shall be written or printed prominently on the invoice or receipt; (d) If the sale involves goods, properties or services some of which are subject to and some of which are VAT zero-rated or VAT-exempt, the invoice or receipt shall clearly indicate the break-down of the sale price between its taxable, exempt and zero-rated components, and the calculation of the VAT on each portion of the sale shall be shown on the invoice or receipt. The seller has the option to issue separate invoices or receipts for the taxable, exempt, and zero-rated components of the sale. (3) In the case of sales in the amount of one thousand peso (Pl,OOO.OO) or more where the sale or transfer is made to a VAT-registered person, the name, business style, if v any, address and TIN of the purchaser, customer or client,

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 25 of65 x------------------------------------------------------------------------------------------x shall be indicated in addition to the information required in (1) and (2) of this Section." In addition to the above requirements, the sales invoices (Sis) and ORs must be duly registered with the BIR as prescribed under Section 237, in relation to Section 238, of the NIRC of 1997, as amended, which provides: "SEC. 237. Issuance of Receipts or Sales or Commercial Invoices.- "(A) Issuance. - All persons subject to an internal revenue tax shall, at the point of each sale and transfer of merchandise or for services rendered valued at One hundred pesos (PlOO) or more, issue duly registered receipts or sale or commercial invoices, showing the date of transaction, quantity, unit cost and description of merchandise or nature of service: Provided, however, That where the receipt is issued to cover payment made as rentals, commissions, compensation or fees, receipts or invoices shall be issued which shall show the name, business style, if any, and address of the purchaser, customer or client: Provided, further, That where the purchaser is a VAT-registered person, in addition to the information herein required, the invoice or receipt shall further show the Taxpayer Identification Number (TIN) of the purchaser." "SEC. 238. Printing of Receipts or Sales or Commercial Invoices. - All persons who are engaged in business shall secure from the Bureau of Internal Revenue an authority to print receipts or sales or commercial invoices before a printer can print the same. No authority to print receipts or sales or commercial invoices shall be granted unless the receipts or invoices to be printed are serially numbered and shall show, among other things, the name, business style, Taxpayer Identification Number (TIN) and business address of the person or entity to use the same, and such other information that may be required by rules and regulations to be promulgated by the Secretary of Finance, upon recommendation of the Commissioner." Thus, only the sales of goods or services supported by the Sis or ORs, having the required information, shall qualify for VAT zero-rating. v

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 26 of65 X---------------- ---- -- --- --- ------- --- ------- -- ---------------------------- ------- --- ---- -X I. Export sales of goods to NRFCs Based on the foregoing, for petitioner's export sales of goods to qualify as zero-rated under Section 106(A)(2)(a)(1) of the NIRC of 1997, as amended, the following essential elements must be present: 1. The sale was made by a VAT-registered person; 2. There was a sale and actual shipment of goods from the Philippines to a foreign country; and, 3. The sale was paid for in acceptable foreign currency accounted for in accordance with the rules and regulations of the BSP. Corollary thereto, any VAT-registered person claiming for VAT zero-rating on its export sale of goods must present at least three (3) types of documents, as follows: 1. sales invoice as proof of sale of goods; 2. bill of lading or airway bill as proof of actual shipment of goods from the Philippines to a foreign country; and, 3. bank credit advice, certificate of bank remittance or any other document proving payment for the goods in acceptable foreign currency or its equivalent in goods and services. Consequently, only the export sales supported by the said documents shall qualify for VAT zero-rating .under Section 106(A)(2)(a)( 1) of the NIRC of 1997, as amended. As discussed earlier, petitioner has proved that it is a VAT-registered person as regards the first essential element. Anent the second essential element, petitioner adduced before this Court its Sis and export documents, such as Bill of Lading (BL) or Waybills, Single Administrative Documents (SADs), and Export Declarations (EDs). B4 84 Exhibits "P-63-A-01-01" to "P-63 -D-34". ~

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 27 of65 X--------------------- --- -------------------- ------ --- -- ---- --- ----------------------------X For the third essential element, petitioner presented the Certificates of Inward Remittance, 85 Account Statements, 86 and Reconciliation of Export Sales and Foreign Currency Remittances 87 to support that the sales were paid for in acceptable foreign currency and accounted for in accordance with the rules and regulations of the BSP, as examined by the ICPA. The ICPA noted the following observations88 in relation to petitioner's sales to NRFC, which the Court finds to be in order, to wit: Observations Sales Amount � per Schedules f) Zero-rated sales arising from the export of Reference goods duly supported by original zero-rated (in PHP) sales invoices dated within April 2018 and i March 2019 and export documents but without valid proof of remittance p 439 ,686.28 AnnexAC g) Zero-rated sales arising from the export of 1,613,499.11 Annex AD goods duly supported by original zero-rated sales invoices dated within April 2018 and (139,532.59) AnnexAH March 2019 with valid proof of remittances but without export documents89 ' i) Zero-rated sales arising from the export of 370,529.51 AnnexAJ goods not duly supported by zero-rated _P2,284, 182.31 sales invoices but with valid proof of remittances and BOC certification of the exportation j) Zero-rated sales arising from the export of goods not duly supported by zero-rated sales invoices but with proof of remittance and BOC certification of exportation - - - - --- However, upon further examination of the submitted supporting documents, the Court finds the following sales to DAH Pte. Ltd. amounting to P1,491,641.14 are not valid for zero-rating based on the reasons stated below: ~ 85 Exhibits "P-86-C" to "P-86-D". 86 Exhibits "P-86-A" to "P-86-B". 87 Ex hibits " P-85-A" to " P-85-E". 88 Exhib it "P-215", Docket - Vol. JII , p. II 08. 89 The !CPA noted in his report th at the P I,6 13,499. 11 zero-rated sale was supported by a bill of lading (Ex hibit " P- 63-B-06-494"). However, examinati on shows th at th e said bill of lading was unreadable. Th us, the Court shall disallow th e same.

DECISION CTA Case No . 10315 Dole Philippin es , Inc. v. Commissioner of Internal Revenue Page 28 of65 X--------------------------------------------- ---------------------------------------------X Invoice Number BL/Airway Proof of Inward Remittance Amount Reason for Bill disallowance Exhibit Invoice Exhibit Exhibit Month Page p 612 ,825.41 Not supported No . No. No. No. July 2018 No . 1 2 6 ,8 7 4 . 7 3 April 2019 21 by BL P-63-B- 87772 P-63-B-08- P-85-C & 355,608.56 05-529 588 P-86-A 5 Not supported P -63 -B- 90505 3 9 6 ,3 3 2 . 4 5 13-764 P-85-C & ' by BL, and the P-86-A P1,491,641.14 P -63 -B- P-85-B & December Invoice was 09-511 P-86-B 2018 102089 4 not found on the records P-63-B- BL does not 08-327 to 101846 P-85-B & November 20 pert ain to P-63-B- P-86-B 2018 08-328 Invoice No. 10 1846 In fine, only the amount ofP36,499,857,975.17 satisfied the essential elements to qualify as VAT zero-rated sales under Section 106 (A)(2 )(a)( 1) of the NIRC of 1997, as amended, to wit: Total Zero-Rated Sales to NRFC P36,310,334,491.67 p 36,503 ,633 ,798.62 Dole Asia Holdings (DAH) Pte. Ltd. 27,845,700.35 Dole Thailand 3,775,823.45 Itochu Metals Corporation 165 ,453,606.60 p 36,499,857,975.17 Less: Disallowances 2,284,182.31 Per ICPA 1,491 ,641.14 Per Court's further verification Total Valid Zero-Rated Sales to NRFC II. Sales to BOI, SBMA, and CDC-registered entities Petitioner claims that it also derived its zero-rated sales to entities registered with the BOI, Department of Trade and Industry (DTI), SBMA, and CDC in the aggregate amount of P29,641 ,223.47, broken down as follows: Customer Name Registration Annexes Amount Type to ICPA (in Pesos) Century Pacific Report Agricultural Ventures, Inc. BOI P21 ,252,520 .02 General Tuna Corporation BOI AB 4,461,530 .88 Philbest Canning BOI AB Corporation AB 1,253,062.00 Fresh Consumer Trade DTI and Logistics, Inc. AF ' 2 ,558,520.00 ~

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x--- ---- -- ----- -- -- ---- ------------ ---- ------ ----- ---- --- -- ---------- --- --- ----- --- -- ---- --x Gem Foods International, SBMA AF 296,620.57 Inc. CDC Milbrae Exports, Inc. AF (181 .,030.001 Total P29,641,223.47 Under Section 106(A)(2)(a)(5) of the NIRC of 1997, as amended and as implemented by Section 4.106-5 of RR No. 16-2005, 9o as amended by RR No. 13-2018 , 9 1 for a ''considered export sale" to qualify as zero-rated, the following essential elements must be present: 1. The sale was made by a VAT-registere,d person; and, 2. There was a sale of goods or services to an entity entitled to incentives under Executive Order No. 226, otherwise known as the Omnibus Investment Code of 1987 (OIC) , and other special laws. As for the first essential element, it is already settled that petitioner is a VAT-registered person. As for the second essential element, any VAT-registered person claiming VAT zero-rated ((considered export sales" must present, among others, the following documents: 1. The sales invoice as proof of sale of goods ; and, 2. The proof of entitlement to zero-rating under the ore or other special laws . Moreover, in Commissioner of Internal Revenue v. Filminera Resources Corporation (Filminera case), 92 the Supreme Court ruled that sales made to a BOI-registered buyer are export sales subject to the zero percent rate if the following conditions are met: 1. The buyer is a BOI-registered manufacturer /producer; 2. The buyer's products are 100�/o exported; and, 3 . The BOI certifies that the buyer exported 100�/o of its products. For this purpose, the BOI Certification is vital 90 Supra at note 50. ~ 9 1 Supra at note 83 . 92 G.R. No. 236325 , September 16, 2020 .

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 30 of65 x---- ------ ------- ----------------------------------------------- ------------ ----- ---------x for the seller-taxpayer to avail of zero-rating benefits. The certification is evidence that the buyer exported its entire product and shall serve as authority for the seller to claim a refund or tax credit. Thus, in compliance with the second essential element, petitioner presented the following: (1) Sales Invoices and Return Sales Invoices;93 and (2) Certificates of BOI and SBMA registration. 94 Upon examination of petitioner's sales invoices, the Court finds that the total amount ofP27,263,733.47 must be disallowed for petitioner's failure to comply with the'invoicing requirements (i.e., failure to indicate the purchaser's TIN in the invoices issued by petitioner), to wit: Customer Name Registration Amount Exhibits Type Century Pacific (in Pesos) Agricultural BOI Ventures, Inc. "P-63-E-1" to "P-63-E- BOI General Tuna 13", "P-63-E-: 19" to "P- Corporation 63-E-21", "P-63-E-23" to "P-63-E-25", "P-63-E-28" to "P-63-E-33", "P-63-E- 35" to "P-63-E-52", "P- 63-E-54" to "P-63-E-71", "P-63-E-75" to "P-63-E- 89", "P-63-E-94" to "P- 63-E-105", "P-63-E-108" to "P-63-E-113", "P-63-E- 117" to "P-63-E-121", "P- 63-E-123"� to "P-63-E- P21 ,252,520.0295 J 132", "P-63-E-137" to "P- 63-E-153", "P-63-E-157" to "P-63-E-165", "P-63-E- 171", "P-63-E-173" to "P- 63-E-209", "P-63-E-211" to "P-63-E-213", "P-63-E- 219" to "P-63-E-226", "P- 63-E-228" to "P-63-E- 235", "P-63-E-239" to "P- 63-E-243", "P-63-E-245" to "P-63-E-255", "P-63-E- 257" to "P-63-E-259", "P- 63-E-261" to "P-63-E- 265" "P-63-E-14", "P-63-E- 4,461,530.8896 I 15", "P-63-E-26", "P-63- 93 Ex hibits " P-63-E-1 " to "P-63-E-269", and " P-63-F-0 1-0 I" to " P-63-F-0 1- 17''. ~ 94 Exhibits " P-99" to " P-I 03 ", US B. 95 Annex AB, US B. 96 !d.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X------------------------------------------------------------------------------------------X Customer Name Registration Amount Exhibits Type (in Pesos) E-27", "P-63-E-34", "P- Philbest Canning BOI 1,253,062.0097 63-E-39", "P-63-E-40", Corporation 296,620.5798 "P-63-E-73", "P-63-E- 74", "P-63-E-90" to "P- Gem Foods SBMA 63-E-93", "P-63-E-106", International, "P-63-E-107", "P-63-E- Inc. 114" to "P-63-E-116", "P- 63-E-122", "P-63-E-133" to "P-63-E-136", "P-63-E- 154", "P-63-E-156", "P- 63-E-166" to "P-63-E- 170", "P-63-E-210", "P- 63-E-227" ~ "P-63-E-244", "P-63-E-256", "P-63-E- 260" "P-63-E-155", "P-63-E- 172", "P-63-E-236" to "P- 63-E-238", "P-63-E-266", "P-63-E-267" Exhibits "P-63-E-16", "P- "6P3--6E3--1E7-"2'2", ".P-6"3P--E6-31-8E"-' 53", "P-63-E-72", "P-63- E-214" to "P-63-E-218", "P-63-E-268", "P-63-E- 269" Total Sales to P27 ,263, 733.47 HOI-registered entities Again, at the risk of being repetitive, petitioner must ensure that its sales of goods or services are duly supported by Sis or ORs that are compliant with the invoicing requirements under Section 113(A) and (B) of the NIRC of 1997, as amended, to qualify for VAT zero-rating. Thus, it is deemed proper to outrightly disallow as valid zero-rated sales the amount of P27,263,733.47 due to petitioner1S failure to comply with the invoicing requirements. On the other hand, while petitioner's sales to Fresh Consumer Trade and Logistics, Inc. amounting to P2,558,520 .0099 were duly supported with Sis dated within the period of claim, they cannot qualify as valid zero-rated sales as petitioner fell short in proving that its products were v 97 !d. 98 Annex AF, USB. 99 The amount oft>2,558,520.00 pertains to sales to Fresh Consumer Trade and Logistics, Inc. ; !CPA's observation letter (h) amounting to P2,674, II 0.57 excluding observation regarding sales to SBMA and CDC ,registered entities amou nting to Pll5,590.57.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 32 of65 x------------------------------------------------------------------------------------------x 100�/o exported, based on the DTI Certificate of Accreditation. loa To reiterate, as ruled in the Filminera case, for a sale to a BOI-registered entity to be accorded VAT zero- rating, petitioner must be able to show that its buyer's products are 100�/o exported. Moreover, it may be noted that petitioner failed to offer a certification issued by CDC to prove entitlement to VAT zero-rating of sales to its supplier Milbrae Exports, Inc. Thus, petitioner's sales thereto cannot qualify for VAT zero-rating. In fine, petitioner's ((considered export sales" cannot qualify for VAT zero-rating. To recapitulate, out of petitioner's zero-rated sales for the period covering April 1, 20 18 to March 31, 20 19 amounting to P36,533,275,022.09, only the amount of !>36,499,857,975.17 qualify for VAT zero-rating, as determined below: Particulars Sales to NRFC Sales to BOI/ �Total P36,503,633, 798.62 SBMA/CDC- Reported Zero- P36 ,533,275,022.09 (2,284 , 182.31) registered rated Sales (1,491,641.14) Entities 101 Less: Exceptions P36,499,857,975.17 1"29,641,223.47 (2,284, 182.31) Noted ----- (29,641,223.47) . (1,491,641.14) Exceptions noted by - (29,641,223.47) the ICPA (Annexes P36,499,857,975.17 AC, AD , AH , and AJ) v Zero-rated sales not supported by BLs and Sales Invoices Failure to comply with the invoicing requirements and to prove entitlement of the BOI/CDC- registered entities to VAT zero-rating Total Valid Zero- Rated Sales ------- 100 Exhibit "P-I 03 ". 101 With Pl.50 difference between the total zero-rated sales reported per return and per schedule. ,

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 33 of65 x------------------------------------------------------------------------------------------x Sixth requisite: The input taxes claimed by petitioner are not transitional. The claimed input taxes do not appear to be transitional, as understood under Section 111 (A) of the NIRC of 1997, as amended, to wit: "SEC. 111. Transitional/ Presumptive Input Tax Credits. (A) Transitional Input Tax Credits. - A person who becomes liable to value-added tax or any person who elects to be a VAT-registered person shall, subject to the filing of an inventory according to rules and regulations presctibed by the Secretary of Finance, upon recommendation of the Commissioner, be allowed input tax on his beginning inventory of goods, materials and supplies equivalent to two percent (2%) of the value of such inventory or the actual value-added tax paid on such goods, materials and supplies, whichever is higher, which shall be creditable against the output tax." As held by the Supreme Court in Fort Bonifacio Development Corporation v. Commissioner of Internal Revenue, 1o2 the transitional input tax credit benefits newly VAT-registered persons, whether or not they previously paid taxes on the acquisitions of their beginning inventory of goods, materials, and supplies. During the transition from non-VAT to VAT status, the transitional input tax credit alleviates the impact of VAT on the taxpayer. Since there is no showing that the claimed input taxes are transitional input VAT, petitioner has complied with the sixth requisite for the grant of an input VAT refund. Seventh requisite: Not all input taxes claimed are due or paid. Anent the seventh requisite, petitioner must provide supporting documents to prove that the input taxes claimed for refund for the period covering April 1, 20 17 to March 31, 2018 were actually due or paid under Section 110(A) of the NIRC of 1997, as amended, which provides: 102 G.R. Nos. 158885 & 170680, April2, 2009. ll

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 34 of65 X-- ---------------------------------- ----- ---- ------- --------------------------------------X "SEC. 110. Tax Credits.- (A) Creditable input Tax. - (1) Any input tax evidenced by a VAT invoice or official receipt issued in accordance with Section 113 hereOf on the following transactions shall be creditable against the output tax: (a) Purchase or importation of goods: 1. For sale; or 11. For conversion into or intended to form part of a finished product for sale including packaging materials; or 111. For use as supplies in the course of business or iv. For use as materials supplied in the sale of serv1ce; or v. For use in trade or business for which deduction for depreciation or amortization is allowed under this Code. (b) Purchase of services on which a value-added tax has actually been paid. (2) The input tax on domestic purchase or importation of goods or properties by a VAT-registered person shall be creditable: (a) To the purchaser upon consummation of sale and on importation of goods or properties; and ' (b) To the importer upon payment of the value-added tax prior to the release of the goods from the custody of the Bureau of Customs. Provided, That the input tax on goods purchased or imported in a calendar month for use in trade or business for which deduction for depreciation is allowed under this Code, shall be spread evenly over the month of acquisition and the fifty-nine (59) succeeding months if the aggregate acquisition cost for such goods, excluding the VAT component thereof, exceeds One Million pesos (P1,000,000): Provided, however, That if the estimated useful life of the capital good is less than five (5) years, as used for depreciation purposes, then the input VAT shall be spread over such a shorter period: Provided, finally, That in the case of purchase of services, lease or use of t/

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 35 of65 x----------- -------------------------------------------------------------------------------x properties, the input tax shall be creditable to the purchaser, lessee or licensee upon payment of the compensation, rental, royalty or fee." The above provisions are implemented by Sections 4.110-1 to 4.110-3 ofRR No. 16-2005,103 as amended, .which provide as follows: "SECTION 4.110-1. Credits for Input Tax. - 'Input tax' means the VAT due on or paid by a VAT-registered person on importation of goods or local purchases of goods, properties, or services, including lease or use of properties, in the course of his trade or business. It shall also include the transitional input tax and the presumptive input tax determined in accordance with Sec. 111 of the Tax Code. It includes input taxes which can be directly attributed to transactions subject to the VAT plus a ratable portion of any input tax which cannot be directly attributed to either the taxable or exempt activity. Any input tax on the following transactions evidenced by a VAT invoice or official receipt issued by a VAT-registered person in accordance with Sees. 113 and 237 of the Tax Code shall be creditable against the output tax: (a) Purchase or importation of goods: (1) For sale; or (2) For conversion into or intended to form part of a finished product for sale including packaging materials; or (3) For use as supplies in the course of business; or (4) For use as materials supplied in the sale of services; or (5) For use in trade or business for which deduction for depreciation or amortization is allowed under the Tax Code, (b) Purchase of real properties for which a VAT has actually been paid; (c) Purchase of services in which a VAT has actually been paid. v 103 Supra at note 50.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 36 of65 X---------------------------------------------- ----- -------- ------ -------------------------X (d) Transactions "deemed sale" under Sec. 106 (B) of the Tax Code; (e) Transitional input tax allowed under Sec. 4.111 (a) of these Regulations; (f) Presumptive input tax allowed under Sec. 4.11"1 (b) of these Regulations; (g) Transitional input tax credits allowed under the transitory and other provisions of these Regulations. SEC. 4.110-2. Persons Who Can Avail ofthe Input Tax Credit. - The input tax credit on importation of goods or local purchases of goods, properties or services by a VAT- registered person shall be creditable: (a) To the importer upon payment of VAT prior to the release of goods from customs custody; (b) To the purchaser of the domestic goods or properties upon consummation of the sale; or (c) To the purchaser of services or the lessee or licensee upon payment of the compensation, rental, royalty or fee. SEC. 4.110-3. Claim for Input Tax on Depreciable Goods. - Where a VAT-registered person purchases or imports capital goods, which are depreciable assets for income tax purposes, the aggregate acquisition cost of which (exclusive of VAT) in a calendar month exceeds One Million pesos (P1,000,000.00), regardless of the acquisition cost of each capital good, shall be claimed as credit against output tax in the following manner: (a) If the estimated useful life of the capital 'good is five (5) years or more - The input tax shall be spread evenly over a period of sixty (60) months and the claim for input tax credit will commence in the calendar month when the capital good is acquired. The total input taxes on purchases or importations of this type of capital goods shall be divided by 60 and the quotient will be the amount to be claimed monthly. (b) If the estimated useful life of a capital good is less than five (5) years - The input tax shall be spread evenly on a monthly basis by dividing the input tax by the actual number of months comprising the estimated useful life of the capital good. The claim for input tax credit shall commence in the calendar month that the capital goods were acquired. v

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 37 of65 x---- ------ --- ------ ----- --- --- -------------------------------------------------------- J---x Where the aggregate acquisition cost (exclusive of VAT) of the existing or finished depreciable capital goods purchased or imported during any calendar month does not exceed one million pesos (Pl,OOO,OOO .OO), the total input taxes will be allowable as credit against output tax in the month of acquisition. Capital goods or properties refers to goods or properties with estimated useful life greater than one (1) year and which are treated as depreciable assets under Sec. 34(Fl of the Tax Code, used directly or indirectly in the production or sale of taxable goods or services. The aggregate acquisition cost of depreciable assets in any calendar month refers to the total price, excluding the VAT, agreed upon for one or more assets acquired and not on the payments actually made during the calendar month. Thus, an asset acquired on installment for an acquisition cost of more than P1,000,000 .00, excluding the VAT, will be subject to the amortization of input tax despite the fact that the monthly payments/installments may not exceed P1,000,000.00. Construction in progress (CIP) is the cost of construction work which is not yet completed. CIP is not depreciated until the asset is placed in service. Normally, upon completion, a CIP item is reclassified and tlie reclassified asset is capitalized and depreciated. CIP is considered, for purposes of claiming input tax, as a purchase of service, the value of which shall be determined based on the progress billings. Until such time the construction has been completed, it will not qualify as capital goods as herein defined, in which case, input tax credit on such transaction can be recognized in the month the payment was made: Provided, that an official receipt of payment has been issued based on the progress billings. In case of contract for the sale of service where only the labor will be supplied by the contractor and the materials will be purchased by the contractee from other suppliers, input tax credit on the labor contracted shall still be recognized on the month the payment was made based on a progress billings while input tax on the purchase of materials shall be recognized at the time the materials were purchased. (a) The amortization of the input VAT shall only be allowed until December 31, 2021 after which taxpayers with unutilized input VAT on capital goods purchased or imported shall be allowed to apply the same as scheduled until fully utilized: Provided, That in the case of purchase of services, lease or use of properties, the input tax shall be ~

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 38 of65 X---------- --------------------------- ---- -- ------------------- --- -- ------------ ------- ----X creditable to the purchaser, lessee or licensee upon payment of the compensation, rental, royalty or fee. XXX XXX XXX Once the input tax has already been claimed while the construction is still in progress, no additional input tax can be claimed upon completion of the asset when it has been reclassified as a depreciable capital asset and depreciated." Relative thereto, Section 4.110-8 of RR No. 16-2005104 provides for the substantiation requirements of input tax credits, as follows: "SEC. 4.110-8. Substantiation ofInput Tax Credits.- (a) Input taxes for the importation of goods or the domestic purchase of goods, properties or services is made in the course of trade or business, whether such input taxes shall be credited against zero-rated sale, non-zero- rated sales, or subjected to the 5% Final Withholding VAT, must be substantiated and supported by the following documents, and must be reported in the information returns required to be submitted to the Bureau: (1) For the importation of goods - import entry or other equivalent document showing actual payment of VAT on the imported goods. (2) For the domestic purchase of goods and properties - invoice showing the information required under Sees. 113 and 237 of the Tax Code. (3) For the purchase of real property- .. . (4) For the purchase of services - official receipt showing the information required under Sees. 113 and 23.7 of the Tax Code. A cash register machine tape issued to a registered buyer shall constitute valid proof of substantiation of tax credit only if it shows the information required under Sees. 113 and 237 of the Tax Code." [Emphasis supplied} Verily, to prove entitlement to credits for input taxes due and paid, petitioner must not only present the supporting documents prescribed under Section 4.110-8 of RR No. 16- v 2005, but also, these documents must comply with the invoicing requirements under Sections 113(A) and (B) , 237 ' M S"P'O ot OOie 50.

DECISION CTA Case No . 1031 5 Dole Philippines , Inc . v. Commissioner of Internal Revenue X- --- -- -------- ---- -- -- ------ -- ---- ----- ------ ---- --- --- -- ---- -------- ------- -------- ---- --X and 238 of the NIRC of 1997, as amended , as implemented by Section 4 . 113-1(A) and (B) of RR No . 16-2005. Based on petitioner's Amended Quarterly VAT Returns los for the period covering April 1, 2018 to March 31 , 2019, petitioner reported current input tax amounting to P1 ,685,855 ,7 16.90 , 106 out of which the amount of Pl,381 ,096 ,733.07107 is the subject of the present claim , as shown below: 1st Qtr 2019 2nd Qtr 2019 3rd Qtr 2019 4th Qtr 2019 Total P- 10 P-13 P-17 P-20 In put Tax Due on Capital Goods exceeding P1M Deferred from p 14,425,367 .03 p 12,054,628 .58 p 9 ,914 ,113 .08 . p 7 ,906,800.60 p 44 300 909.29 previous - quarter - - - - Purchase of Capital Goods Exceeding P1M Total 1 4 , 4 2 5 ,3 6 7 .0 3 12,054 ,628.58 9 ,914 ,113 .08 7 ,906 ,800.60 44 ,300,909 .29 Less: Deferred 12 ,054 ,628 .58 9 ,914 ,113 .10 7 ,906 ,800 .57 6 ,087,772.66 3 5 ,9 6 3 , 3 1 4 . 9 1 for the succeeding period Amortized 2 ,370,738.45 2 ,140,515.48 2,007 ,312 .51 1,819 ,027 .94 8 ,337,594.38 input tax on 213 ,045,590.10 capital goods 8 1,418,138 .62 145,798,573 .68 206 ,960 ,536.98 647 ,222,839 .38 exceedin_q P 1M - Input Tax Du e on Current Purchases of Goods other than Capital Goods Input Tax Paid on: Importation of 106 ,796,280 .00 61 ,619 ,675.00 102 ,321 ' 190.00 . 8 2 , 5 9 2 , 6 6 5 .0 0 353 ,329,810 .00 goods other 597,485 ,938 .87 than capital 166,334,109.49 129,701 ,730.68 172,452 ,962.52 128,997 136.18 goods Input tax on domestic purchases of services Services 15 ,220 ,045 .67 17 830 ,133. 10 24 ,502 ,126.87 21 ,902 ,712.08 79,455,017 .72 Rendered by Non-Residents Sub-total 288,350 ,435 . 16 209,151 ,538.78 299 ,276,279.39 233 ,492,513 .26 1,030,270 ,766 .59 Creditable Withholding VAT (reflected as Others in VAT 4 010 .39 17,368.22 2,585.48 552.46 24,516.55 Returns) 105 Exhibits "P-1 0", " P-13 ", " P-1 7'', and " P-20", Docket - Vol. III , pp. 1420 to 1421 , 1426 to 1427, 1434 to 1435, v and 1440 to 1441. 106 Exhibit "P-215", Docket- Vol. III, p. 11 14. 107 With di screpancy of PO.O I against the total amount per VAT Returns.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 40 of65 X---------------- -- -------- -- ------ ---- -------- -------------------------------- ------------X Total input tax 372,143,322.62 357,107,996.16 508,246,714.36 ' during the period 116,180,073 .87 448,357,683.76 1,685,855,716.90 Less: Output tax 51,391,194.57 66 ,487,202.13 P392,066,640.49 70,700 ,513 .25 304,758,983 .82 Excess input tax P320,752,128.05 P290,620,794.03 P377,657,170.51 P1,381,096,733.08 Based on the foregoing, petitioner's input VAT consists of the following: a) Domestic Purchase of Goods Other than p 647,222,839.38 Capital Goods 597,485,938.87 b) Domestic Purchase of Services p 1,244,708,778.25 Total Input VAT from Domestic Purchases of Goods and Services 353,329,810.00 79,455,017.72 c) Importation of Goods Other than Capital Goods 8,337,594.38 ,24,516.55 d) Services rendered by Non-residents e) Amortized input tax on capital goods for FY P1,685,855,716.90 2019 f) Others Total Current Input VAT To support its input VAT arising from importations and domestic purchases of goods and services, petitioner submitted its importation documents [i.e., SAD, Statement of Settlement of Taxes and Duties (SSDT)], Supplier's Certification, Computation for the Transfer Pricing Adjustments, Debit and Credit Memos,1os and VAT Sis and ORs l09 issued by its various suppliers, which the ICPA examined. Based on the !CPA's review of petitioner's supporting documents, out of petitioner's total input VAT amounting to P1,685,855,716.90, only the total amount of P1,611,787,038.32 was duly substantiated and supported by documents in accordance with the invoicing requirements. The result of the !CPA's reviewuo is shown below: ~ 108 Exhib its "P-78-A" to " P-79". 109 Exhibits "P-60-A-0 1-1 " to "P-60-D-13-56"; "P-6 1-A-03-1 " to "P-61-B-955". 11 0 Exhibit "P-215", Docket- Vol. III, pp. 11 28 to 1129.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X------------------------------------------------------------------------------------------X Per Claim111 Per ICPA a. Local purchases of goods p 1,244,708,778.25 P1, 171,255,240.68112 and services 353,329,810.00 352,719,233.23113 b. Importation c. Services rendered by Non- 79,455,017 .72 79,455,016.32114 residents 8,337,594.38 8 ,337,594.39115 d. Amortized input tax on 24,516.55 19,953.70116 capital goods for FY 20 19 P1,685,855,716.90 P P1,611,787,038.32 e. Others Total Input Tax Domestic purchase of goods and services and Importation Pl,S98,038,588.25117 Comparison made by the ICPA of the input VAT on domestic purchases of goods and services and importation based on supporting documents submitted for his review by petitioner in the total amount of P1,602,783,734.13 against the input VAT reported in the schedule (Summary List of Purchases118 and Summary List of Importations 119) and VAT returns amounting to P1,598,037,598.96 resulted in a difference amounting to P4,746, 135.17, the pertinent portion of the ICPA report is reproduced below: Observations Domestic Importation Total Input taxes supported by proper documents p 1' 171,255,240.68 p 352,719,233.23 p 1,523,974,473.91 Input taxes not duly supported by proper 78,036,059.22 773,201.00 78,809,260.22 documents Total input taxes P1,249,291,299.90 P353,492,434.23 P1,602,783,734.13 examined Input taxes per schedule 1,598,037,598.96 Difference p 4,746,135.17 ~ 11 1 Exhibits "P-10", "P-13", " P-17", and " P-20", Docket- Vol. Ill, pp. 1420 to 1421 , 1426 to 1427, 1434 to 1435, and 1440 to 1441. 112 Annexes AK, CR, AL, CS, AM, CT, CZ, BF, BR, FA, FB, FC, FF, GA, FG, FH, FI, BT, FO, FP, GC, GB, FS, BU, BY, GE, GK, GF, BZ, GG, GJ , GH , CA, GL, GS , GN , GO, CB, GP, CH, CI, HG, CM, and HK of Exhibit "P- 215", Docket-Vol. III, pp. 1116to 1118. � 11 3 Annexes AN, CB, CK, CL, CO, CP, and CQ of Exhibit " P-215", Docket- Vol. III, pp. 1126 to 1127. 11 4 Par. 126 of Exhibit "P-2 15", Docket- Vol. III, pp. 1127 to 1128. 11 5 Pars. 127 and 128 of Ex hibit "P-215", Docket - Vol. Ill, p. 11 28. 11 6 Par. 129 of Exhibit "P-215", Docket- Vol. III, p. 11 28. 11 7 Items a, b, and c, Par. 115 of Exhibit " P-215", Docket - Vol. III, p. 1114. 118 Exhibit "P-74". 11 9 Exhibit "P-75".

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 42 of65 X------------------------------------------------------------------------------------------X It is to be noted that there is a difference of P989.29 between the total input VAT declared pet return (P1,598,038,588.25) and the total input VAT used by the ICPA in its report, as shown in the table above (P1,598,037,598.96). Thus, the difference should only be P4,745,145.88. The ICPA accounted for the difference ofP4,746, 135.17, as follows: Reference Domestic Importation Total Annex CB and Annex p 2,571,483.73 GP p 2,571,483.73 Annex BY and Annex 1,997,520.81 GE 1,997,520.81 Annex FH 6,685.7 1 Annex GC 6,086 .61 p 21,144.00 6,685.71 Annex GF 71,316.23 6,086.61 Annex FP 380.74 71,164.00 Annex FF 245.85 380.74 Annex CB 107.48 P163,624.23 245.85 Annex CO Annex CP P4,582,510.93 ' Total 107.48 21,144.00 71,316.23 71,164.00 P4, 746,135.16120 The ICPA explained that the difference pertains to input taxes duly supported by valid invoices and receipts but not included in the schedule. Thus, there is an understatement of input taxes in the schedule vis-a-vis the actual supporting documents. 121 Upon careful examination of the supporting documents, the Court finds that the difference of P4,746, 135.17 arose from the following: (1) the spot rate used by petitioner in recording its transactions was different from the exchange rate used by the ICPA in his review; and, (2) only a portion of the total input VAT per supporting document was claimed. However, the Court cannot go beyond the subject claim. Analogous to an assessment case, the power to assess is bestowed to respondent; thus, the Court is constrained to limit its findings based on the disputed claim only. 122 Consequently, the Court will not consider the !CPA's tyT( 120 With 0.0 I difference due to rounding off. 121 Par. 120 of Exhibit "P-215", Docket - Vol. III, p. II 16. 122 Commissioner of Internal Revenue v. Transnational Plans, Inc., CTA EB Nos. 133 7 and 1339 (CTA Case No. 8291), March 27, 2017.

DECISION CTA Case No . 103 15 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 43 of65 X----- ---------- --- ------------------ ------------------- ----- --- ----------- --- ------ ---- ---X conclusion that there was an understatement of input VAT in the adjusted amount of P4,745, 145.88123. The Court will then proceed to determine whether petitioner complied with the requisites for a valid refund claim of its alleged excess or unutilized input VAT. Based on the ICPA report, out of the total input VAT on domestic purchases of goods and services of Pl,244 ,708,778.25, We find the following disallowances amounting to P78,036,059.22 proper; thus, shall be sustained: Observations Amount I Reference 1) Input VAT on domestic purchases of goods and P 38,567, 154.35 I Annex AO services not duly supported by original TIN VAT Annex CU Invoice I TIN VAT ORs dated April 2018 to March 1,902.41 I Annex CV 2019. 2 ,893.90 I Annex CW 2) IVAT on goods and services supported b y 1,355.65 I Annex CX invoice/official receipt without the word "TIN VAT"; Possible overclaiming of IVAT 1,285.71 I Annex CY 3) IVAT on goods and services supported by 15,096.47 I Annex AR invoice/official receipt without the word "TIN VAT"; Annex CZ Incomplete or incorrect name of buyer indicated on the invoice/ official receipt; Incomplete or incorrect address of buyer indicated on the invoice/official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice I official receipt; No business style of buyer indicated on the invoiceI official receipt 4) IVAT on goods and services supported by invoice/official receipt without the word "TIN VAT"; Incomplete or incorrect address of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Possible underclaiming of IVAT; Possible underclaiming of IVAT; Possible underclaiming of IVAT; 5) IVAT on goods and services supported by invoice/official receipt without the word "TIN VAT"; Invoice/Official Receipt with statement "Document not valid for claiming input taxes"; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the _y_e a r ; 6) Input VAT on domestic purchases of goods and services that are properly supported by invoicesjORs dated April20 18 to March 2019 , but the Company' s name was incomplete/incorrect 123 Acco unted difference off'4,746,135. 17 less ty pographical error in input VAT per VAT returns used by the !CPA ~t\ / in his report.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 44 of65 x------------------------------------------------------------------------------------------x Observations Amount I Reference 62,813.161 Annex AS 7) Input VAT on domestic purchases of goods and � Annex DE services supported by TIN VAT Invoice/TIN VAT 42,900.15 I Annex DF ORs dated April 2018 to March 2019, but the Company's name and address are wrong. 12,257.40 I Annex DG 8) Incomplete or incorrect name of buyer indicated on 5,857.12 1 Annex AT the invoice/ official receipt; Incomplete or incorrect Annex DL address of buyer indicated on the invoiceI official 4,658.47 I Annex DM 2,245.10 I Annex DN receipt; Incomplete or incorrect TIN of buyer 927.75 I Annex DO indicated on the invoice/ official receipt; 2,177.19 I Annex DP 9) Incomplete or incorrect name of buyer indicated on 204,007.32 I Annex AU the invoiceI official receipt; Incomplete or incorrect Annex DH 2,616.87 I Annex DI address of buyer indicated on the invoice j official receipt; IVAT on goods and services supported by ~ invoice/ official receipt dated outside the taxable quarter but within the vear; 10) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019 but the Company's name and TIN. 11) Incomplete or incorrect name of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice I official receipt; Possible overclaiming of IVAT; 12) Incomplete or incorrect name of buyer indicated on the invoiceI official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; 13) Incomplete or incorrect name of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Possible underclaiming of IVAT; No business style of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoiceI official receipt; 14) Incomplete or incorrect name of buyer indicated on the invoice/ official receipt; Invoice/ official receipt with alteration on buyer's name and without countersign of vendor 15) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company's name, TIN, address, and business style are incorrect/incomplete. 16) Incomplete or incorrect name of buyer indicated on the invoice/ official receipt; Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year; IVAT on

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 45 of65 )(-------- ------------------------------------------------------------------- ------------ ---)( Observations Amount Reference goods and services supported by invoicef official 33,963.43 I Annex DK receipt dated outside the taxable quarter but 94,721.42 I Annex AW within the year; Annex DJ 17) Incomplete or incorrect name of buyer indicated on 1,937.14 I Annex DA the invoicef official receipt; Incomplete or incorrect 2,599.29 I Annex DB address of buyer indicated on the invoice/ official 143,110,. 30 I Annex AX receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; No Annex DC business style of buyer indicated on the 7,611.95 I Annex DD invoicef official receipt; No business style of buyer indicated on the invoice/official receipt; No business style of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year 18) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company's name, address, and business style are incorrect/incomplete. 19) Incomplete or incorrect name of buyer indicated on the invoicef official receipt; IVAT on goods and services supported by invoice/ official receipt with no date or incomplete date; Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice j official receipt; Incomplete or incorrect TIN of buyer indicated on the invoicef official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/official receipt; 20) Incomplete or incorrect name of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/official receipt with no date or incomplete date; Incomplete or incorrect address of buyer indicated on the invoicef official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoicef official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; IVAT on goods and services supported by certified true copy of invoice/official receipt 21) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs but with no invoice date or incomplete invoice date, and the Company's name , TIN, address , and business style are incorrect/incomplete. 22) Incomplete or incorrect name of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/official receipt with no date or incomplete date; Incomplete or incorrect address of buyer indicated on the invoicef official receipt; Incomplete or incorrect TIN of buyer indicated on the invoicef official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; Incomplete or incorrect ~

DECISION CTA Case No. 10315 Dole Philippines, Inc . v. Commissioner of Internal Revenue Page 46 of65 X------ --- --- ----- ----- ------- ----- --- ---------- -------- --------- -- ---- --- ---- --- --- --- ----X Observations Amount Reference TIN of buyer indicated on the invoice/ official ) receipt; No business style of buyer indicated on the invoice/ official receipt 23) Input VAT on domestic purchases of goods and 413.04 AnnexAY services supported by TIN VAT Invoice/TIN VAT ORs but with no invoice date or incomplete invoice 276,343.62 AnnexAZ date, and the Company's name and business style . Annex DQ are incorrect/incomplete. 1,237.51 Annex BA 24) Input VAT on domestic purchases of goods and services supported by VAT invoices/TIN VAT ORs 308,530.70 Annex BB but with no or incomplete invoice date. 168'.03 Annex BC 25) Input VAT on domestic purchases of goods and s ervices supported b y VAT invoices/TIN VAT ORs 105,267.88 Annex BD but with no invoice date or incomplete invoice Annex DR date , and the Company' s address and business style are incorrect/incomplete. 319.78 Annex BE 26) Input VAT on domestic purchases of goods and 268.39 Annex BF services supported by VAT invoices/TIN VAT ORs but with no invoice date or incomplete in voice I date, and the Company' s address , TIN , and business style are incorrect/incomplete. 15,513,943.41 Annex BG Annex DS 27) Input VAT on domestic purchases of goods and services supported by VAT invoices/TIN VAT ORs 702,035.85 Annex BH but with no invoice date or incomplete invoice Annex DT date , Company' s TIN and business style are incorrect/incomplete, and VAT amount is not 324,121.36 Annex BI indicated/ not separately shownjnot properly Annex DU shown in the designated line item. v 28) Input VAT on domestic purchases of goods and services supported by VAT invoices/TIN VAT ORs but with no invoice date or incomplete invoice date , and the Company's TIN and business style are incorrect/incomplete. 29) Input VAT on domestic purchases of goods and services supported by VAT invoices/TIN VAT ORs but with no invoice date or incomplete invoice date , and VAT amount is not indicated/ not separately shown/not properly shown in the designated line item. 30) Input VAT on domestic purchases of goods and services supported by VAT invoices/TIN VAT ORs but with no invoice date or incomplete invoice date and the Company' s business style is incorrect/incomplete. 31) Input VAT on domestic purchases of goods and services claimed during the period April 2018 to March 2019 , but the TIN VAT Invoices/TIN VAT ORs were not dated within the refund period. 32) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company's address is incorrect/incomplete 33) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 47 of65 X------------------------------------------------------------------------------------------X Observations Amount Reference ORs dated April 2018 to March 2019, but the 7,097.53 I Annex DV Company's address and TIN. 34) Incomplete or incorrect address of buyer indicated 12,844.80 I Annex DW on the invoice/ official receipt; Incomplete or 1,126.91 I Annex DX incorrect TIN of buyer indicated on the invoice/ official receipt; Invoice j official receipt with 16,830.79 I Annex DY alteration on buyer's name and with countersign of the vendor; Invoice/ official receipt with Annex BJ alteration on the date and with countersign of the vendor; Invoice/official receipt with alteration on 34,666.72 I Annex DZ the date and with countersign of the vendor; Invoice j official receipt with alteration on the date 73.39 I Annex EA and with countersign of the vendor; No business 459,600.40 I Annex BK style of buyer indicated on the invoice j official Annex EB receipt 35) Incomplete or incorrect address of buyer indicated v on the invoice j official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Propriety of forex rates used (i.e., possible overclaiming); 36) Incomplete or incorrect address of buyer indicated on the invoice j official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Possible underclaiming of IVAT; 37) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Possible underclaiming of IVAT; No business style of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; 38) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company's address, TIN, and business style are incorrect/incomplete, and VAT amount is not indicated/not separately shownjnot properly shown in the designated line item. 39) Incomplete or incorrect address of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/official receipt; VAT amount not indicated/not separately shown/not properly shown on the designated line item; 40) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company's address, TIN, and business style are incorrectI incomplete.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 48 of65 X------------------------------------------------------------------------------------------X Observations Amount I Reference 1,449.66 I Annex EC 41) Incomplete or incorrect address of buyer indicated 503.57 I Annex ED on the invoice/ official receipt; Incomplete or 42,862.00 I Annex EE incorrect TIN of buyer indicated on the 44,132.02 I Annex EF invoice/official receipt; IVAT on goods and 28,027.27 I Annex EG services supported by invoice/official receipt dated 49,866.55 I Annex EH outside the taxable quarter but within the year; 3,183.08 I Annex EI 42) Incomplete or incorrect address of buyer indicated on the invoice/ official receipt; Incomplete or 258.48 I Annex EJ incorrect TIN of buyer indicated on the 1,138.23�1 Annex EK invoice/official receipt; IVAT on goods and services supported by certified true copy of v invoice/official receipt; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year; VAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; 43) Incomplete or incorrect address of buyer indicated on the invoice1official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; IVAT on goods and services supported by invoiceI official receipt dated outside the taxable quarter but within the year; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; 44) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; InvoiceI official receipt with alteration on buyer's name and with countersign of vendor 45) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; InvoiceI official receipt with alteration on buyer's name and without countersign ofvendor 46) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Invoice/ official receipt with alteration on the date and with countersign of the vendor. 4 7) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Possible overclaiming of IVAT; VAT amount not indicated/not separately shown/not properly shown on the designated line item; 48) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Possible underclaiming of IVAT; Invoice/Official Receipt with statement "Document not valid for claiming input taxes"; 49) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; Possible

DECISION CTA Ca se No. 10315 Dole Philippines, Inc . v. Commissioner of Internal Revenue Page 49 of65 x--- ------ --- ----- ------ -------------- -- -- -- ------ ---- ------ -------- ------ ---- -- -------- ---x Observations Amount Reference underclaiming of IVAT; IVAT on goods and services 5,357.14 Annex EL supported by invoice/official receipt dated outside ' the taxable quarter but within the year; 151.64. Annex EM 50) Incomplete or incorrect address of buyer indicated on the invoice/official receipt; VAT amount not 32,919.19 Annex EN indicated/not separately shown/not properly 554.40 Annex EO shown on the designated line item; IVAT on goods and services supported by a certified true copy of ' the invoiceI official receipt; No business style of 41,924.41 Annex BL Annex EP buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the 2,713 ,854.43 Annex BM invoice/ official receipt; No business style of buyer Annex EQ indicated on the invoice/ official receipt; 114,378.38 Annex ER 51) Incomplete or incorrect address of buyer indicated on the invoiceI official receipt; InvoiceI Official 10,195.89 AnnexES Receipt with statement "Document not valid for claiming input taxes"; No business style of buyer 18,608.80 Annex BN indicated on the invoice/ official receipt; ' 52) Incomplete or incorrect address of buyer indicated 22,311.85 Annex ET on the invoice/official receipt; IVAT on goods and services supported by a certified true copy of the Annex EU 15,551.67" invoiceI official receipt v 53) Incomplete or incorrect address of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by a certified true copy of the invoice/ official receipt; No business style of buyer indicated on the invoiceI official receipt; 54) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company' s address and business style are incorrectI incomplete. 55) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019 , but the Company' s TIN is incorrect/incomplete. 56) Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; InvoiceI official receipt with alteration on buyer's name and with countersign of vendor 57) Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; Invoice/ official receipt with alteration on buyer's name and without countersign of vendor 58) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019 , but the Company's TIN is incorrect/incomplete and with alteration in invoice/OR date and/or amount that is not countersigned. 59) Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt; Possible overclaiming of IVAT; No business style of buyer indicated on the invoiceI official receipt; 60) Incomplete or incorrect TIN of buyer indicated on the invoice j official receipt; VAT amount not

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 50 of65 x- -- -- ---- --- --------- ---- -- ---------------------------- --- ----- -- ----- --- -- ----- ------- ---x Observations Amount Reference indicatedI not separately shown/not properly 150,372 .03 Annex EV shown on the designated line item , 61) Input VAT on domestic purchases of goods and 19,676.57 Annex EW services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the 1,789,318.18 Annex BP Company's TIN and business style are incorrect/incomplete, and VAT amount is not � Annex EX indicated/not separately shown/not properly shown in the designated line item. 1,711.34 Annex BQ 62) Incomplete or incorrect TIN of buyer indicated on the invoice j official receipt; IVAT on goods and Annex EY services supported by a certified true copy of the 22,945.71 Annex EZ invoiceI official receipt I 63) Input VAT on domestic purchases of goods and services supported b y TIN VAT Invoice/TIN VAT 25,950.54 Annex FD ORs dated April 2018 to March 2019 , but the Company' s TIN and business s tyle are 11,414.38 Annex FW incorrect/incomplete. 358.34 Annex FE 64) Input VAT on domestic purchases of goods and services supported by TIN VAT InvoicejTIN VAT 1.07 Annex GA ORs that were not dated within respective quarter of the period of refund and the Company's TIN and I business style is incorrect/incomplete. 659.61 Annex FG 65) Incomplete or incorrect TIN of buyer indicated on 20,313.05 Annex FJ the invoice j official receipt; Invoice j official receipt v with alteration on the date and with countersign of the vendor; No business style of buyer indicated on the invoiceI official receipt; 66) Invoice/ official receipt with alteration on buyer's name and with countersign of vendor; Invoice/ official receipt with alteration on the date and without countersign of vendor 67) Invoice/official receipt with alteration on buyer's name and with countersign of vendor; Invoice j official receipt with alteration on the date and without countersign ofvendor; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year; 68) Invoice/official receipt with alteration on buyer's name and with countersign of the vendor; Invoice j official receipt with alteration on the date and without countersign of the vendor; Possible underclaiming of IVAT; 69) Invoice/official receipt with alteration on buyer's name and with countersign of vendor; Propriety of forex rates used (i.e., possible overclaiming) 70) Invoice/official receipt with alteration on buyer's name and with countersign of the vendor; Possible overclaiming of IVAT 71) Invoice/ official receipt with alteration on buyer's name and with countersign ofvendor; No business style of buyer indicated on the in voice/ official receipt; IVAT on goods and services supported by invoice j official receipt dated outside the taxable quarter but within the year;

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x- ------- ---- -- --- --- --------- ---- ---- --- ---- ------ ----- ------- --- --- -- ---- ------ ------- ---x Observations Amount Reference 72) Invoice/official receipt with alteration on buyer's 3,295 .57 Annex FY name and with countersign of vendor; No business style of buyer indicated on the invoice/ official 488,458.10 Annex BS receipt Annex FK 73) Input VAT on domestic purchases of goods and ' services supported by invoicesjORs dated April 2018 to March 2019 with alteration m the 4,285.71 Annex FZ Company's name and not countersigned by the vendor. 19,700.78 Annex FL 23,682.26 Annex FM ' 74) Input VAT on domestic purchases of goods and services that are supported by invoicesjORs dated ' April 2018 to March 2019 with alteration in the Company's name and not countersigned by the 2,793 .05 Annex FN vendor ; No business style of buyer indicated on the 21 ,631.50 Annex BT invoice I official receipt; IVAT on goods and Annex FO 531.01 ' Annex GB services supported by invoice/ official receipt dated outside the taxable quarter but within the year; 9,629 .84 Annex FX 6,982.73 Annex FQ 75) Invoice/official receipt with alteration on buyer's name and without countersign of vendor; ' Invoice/ official receipt with alteration on the date 3,022.20 Annex FR and without countersign of vendor v 76) Invoice/ official receipt with alteration on buyer's name and without countersign of vendor; Invoice/ official receipt with alteration on the date and without countersign ofvendor; IVAT on goods and services supported by invoice j official receipt dated outside the taxable quarter but within the year; 77) Invoice/official receipt with alteration on buyer's name and without countersign of vendor; VAT computation indicated on the invoice/official receipt is erroneous 78) Input VAT on domestic purchases of goods and services duly supported by original TIN VAT invoices/ORs but with alteration in invoice/OR date and/or amount and countersigned. 79) InvoiceI official receipt with alteration on the date and with countersign of the vendor ; Propriety of forex rates used (i.e. , possible overclaiming) ; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; 80) Invoice/official receipt with alteration on the date and with countersign of the vendor; VAT amount not indicated/not separately shown/not properly shown on the designated line item 81) Invoice/ official receipt with alteration on the date and with countersign of the vendor; VAT amount not indicated/not separately shown/not properly shown on the designated line item; IVAT on goods and services supported by invoiceI official receipt dated outside the taxable quarter but within the year; 82) InvoiceI official receipt with alteration on the date and with countersign of the vendor ; VAT computation indicated on the invoiceI official receipt is erroneous

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 52 of65 X------ ----------------------------------------------- ---------------- ---------------------X Observations Amount Reference 83) Invoice/ official receipt with alteration on the date Annex FT and with countersign of the vendor; No business style of buyer indicated on the invoice j official 31,742.08 receipt . 1,861,459.12 Annex BV 84) Input VAT on domestic purchases of goods and Annex FU services duly supported by original TIN VAT invoicesjORs but with alteration in invoice/OR 40,603.89 Annex BW date and/ or amount and not countersigned. Annex FV 85) Input VAT on domestic purchases of goods and 664.29 � Annex GD services duly supported by original TIN VAT invoicesjORs but with alteration in invoice/OR 62,130.24 Annex BX date andjor amount and not countersigned VAT amount is not indicated/not separately shown/not 535,243.94 Annex BZ properly shown in the designated line item. Annex GG 86) Input VAT on domestic purchases of goods and 140.80 Annex GJ services duly supported by original TIN VAT invoicesjORs but with alteration in invoice/OR 54.82" Annex GH date andjor amount and not countersigned.; IVAT on goods and services supported by a certified true 99,299.02 Annex GI copy of the invoiceI official receipt 535,743, 11 Annex CA Annex GL 87) Input VAT on domestic purchases of goods and services duly supported by original TIN VAT 4,195.88 Annex GR invoices j 0 Rs that were not dated within a respective quarter of the period of refund and with v alteration in invoice/OR date andjor amount and not countersigned. 88) Input VAT on domestic foreign -currency- denominated purchases of goods and services duly supported by original TIN VAT Invoice/TIN VAT ORs, but erroneously computed due to incorrect foreign exchange rate used (overclaimed). 89) Propriety of forex rates used (i.e ., possible overclaiming) ; IVAT on goods and services supported by a certified true copy of the invoiceI official receipt 90) Propriety of forex rates used (i.e. , possible overclaiming); IVAT on goods and services supported by a certified true copy of the invoiceI official receipt; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year; 91) Propriety of forex rates used (i.e., possible overclaiming); No business style of buyer indicated on the invoice/official receipt; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year; 92) Input VAT on domestic purchases of goods and services duly supported by original TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019 , but input VAT erroneously computed (overclaimed). 93) Possible overclaiming of IVAT; Incomplete or incorrect TIN of buyer indicated on the invoiceI official receipt

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 53 of65 x- -- -- ----- --- -- ------------ ---- --- --- ----- -- ------------------- -- --- ---- ---- --- -------- ---x Observations Amount Reference 94) Possible overclaiming of IVAT; Invoice/ official 51.43 Annex GS receipt with alteration on the date and with countersign of the vendor. 1,220.09 Annex GT ' 95) Possible overclaiming of IVAT; VAT computation indicated on the inv oice/ official receipt IS 11,863.50 Annex GM erroneous; IVAT on goods and services supported 129.60 Annex GN by invoice I official receipt dated outside the taxable 2,643.64 Annex GO quarter but within the year; 93.83 Annex GU 96) Possible overclaiming of IVAT; Invoice/ Official ' Receipt with statement "Document not valid for claiming input taxes"; IVAT on goods and services 535.71 Annex GQ supported by invoice/official receipt dated outside the taxable quarter but within the year; 4 ,099,764.95 Annex CC 97) Possible overclaiming of IVAT; IVAT on goods and Annex GV services supported by a certified true copy of the 143,536.41 Annex GW invoiceI official receipt 153, 160'.13 Annex CD 98) Possible overclaiming of IVAT; IVAT on goods and Annex GX services supported by certified true copy of invoice/official receipt; IVAT on goods and services 4,741.29 Annex GY supported by invoice/official receipt dated outside the taxable quarter but within the year: v 99) Possible underclaiming of IVAT; Incomplete or incorrect address of buyer indicated on the invoice/ official receipt; Incomplete or incorrect TIN of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; Incomplete or incorrect name of buyer indicated on the invoice/ official receipt 100) Possible underclaiming of IVAT; VAT computation indicated on the invoice/ official receipt is erroneous; IVAT on goods and services supported by invoice/official receipt dated outside the taxable quarter but within the year; 101) Input VAT on domestic purchases of goods and services duly supported by original TIN VAT Invoice /TIN VAT official receipts dated April 20 18 to March 2019 , but VAT amount IS not indicated/ not separately shownjnot properly shown in the designated line item. 102) VAT amount not indicatedI not separately shownjnot properly shown on the designated line item; IVAT on goods and services supported by a certified true copy of the inv oice/ official receipt 103) Input VAT on domestic purchases of goods and services duly supported by original TIN VAT Invoice/TIN VAT official receipts , but VAT amount IS not indicated/not separately shown/not properly shown m designated line item and business style is not indicated 104) VAT amount not indicated/ not separately shown/not properly shown on the designated line item; IVAT on goods and services supported by invoice I official receipt dated outside the taxable

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 54 of65 x-- --- ---- ---- -- -- -- -- --- ------- --- -- -- ------ -- ---- ----- --- ------------- -- ----- ----- -- -- ---x Observations Amount Reference quarter but within the year; Invoice/official receipt 3 ,677,668.82 Annex CE Annex GZ with alteration on the date and with countersign of ' Annex HC the vendor. ; 25,886 .52 Annex HA 25,131.29 Annex HB 105) Input VAT on domestic purchases of goods and 3 ,420 .00 Annex CF services duly supported by original TIN VAT 355 ,742.15 Annex HD 594 ,344.76 Annex CG Invoice /TIN VAT official receipts dated April 2018 Annex HE 1,372. 93 Annex HF to March 2019 , but VAT computation is incorrect. 33,822 .00 31,114.29 Annex HH 106) VAT computation indicated on the 2 ,945,593.80 Annex HI invoice/ official receipt is erroneous; P78,036,059.22 Annex CJ Invoice/ official receipt with alteration on the date Annex HJ and without countersign of vendor 107) VAT computation indicated on the invoice I official receipt is erroneous; Possible overclaiming of IVAT 108) VAT computation indicated on the invoice/official receipt is erroneous; !VAT on goods and services supported by a certified true copy of the invoiceI official receipt 109) Input tax on domestic purchases of goods and services supported with invoicesjORs dat ed within April 2018 to March 2019 but classified as VAT- exempt purchase 110) Input tax on domestic purchases of goods and services supported with invoicesjORs dated within April 2018 to March 2019 but with the statement "Document not valid for claiming input taxes. " 111) Invoice/ Official Receipt with statement "Document not valid for claiming input taxes"; IVAT on goods and services supported by a certified true copy of the invoice/ official receipt 112) IVAT on goods and services supported by a certified true copy of the invoice/ official receipt; No business style of buyer indicated on the invoiceI official receipt 113) IVAT on goods and services supported by a certified true copy of the invoice/ official receipt; No business style of buyer indicated on the invoice/ official receipt; IVAT on goods and services supported by invoice/ official receipt dated outside the taxable quarter but within the year; 114) Input VAT on domestic purchases of goods and services supported by TIN VAT Invoice/TIN VAT ORs dated April 2018 to March 2019, but the Company' s business style is not indicated Total Likewise, the input VAT on the importation . of goods amounting to P773,20 1.00 should be disallowed for petitioner's failure to properly account and substantiate the same, summarized as follows: v

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X- ---------------- ----------------------------- -------------- -- ---------- ------------------X Observations Amount Reference 1) Input VAT on importation of goods not duly P1,564,675.00 AnnexAP supported by SSDT and SAD claimed under the period of refund. -791,474 .00 Annex CN 2) Input VAT on importation of goods not duly P773,201.00.00 supported by SSDT and SAD claimed and commercial invoice under the period of refund. Total Moreover, the Court finds that the input VAT amounting to P45, 116,209.84 without supporting exhibits and with supporting exhibits but were denied admission by the Court, 12 4 should likewise be disallowed, to wit: 1. Input VAT from domestic purchase of goods and services supported by denied exhibits Annex Exhibit Supplier Input VAT CR "P-60-A-02- DAVAO DEL NORTE ELECTRIC p 8639" COOPERATIVE 7,988.22 CR "P-60-A-04- KING SOLOMON & ALLIED 13,423.99 5231" SERVICES CR "P-60-A-04- KING SOLOMON & ALLIED 48,868.63 5251" SERVICES Sub-total p 70,280.84 2. Input VAT from importation without supporting documents Annex Exhibit Particulars Input VAT WITHDRAWAL FROM PEZA FOR AN - CONSUMPTION / SALE OF SCRAP MATERIALS p 45,045,929.00 Sub-total p 45,045,929.00 Total - p 45,116,209.84 ~ In sum, out of petitioner's total input VAT from importation and domestic purchase of goods and services amounting to P1,598,038,588.25, the total amount of P123,925,470.06 shall be disallowed for petitioner's failure to meet the substantiation and invoicing requirements .under the existing law and regulations, determined as follows: � Exceptions noted by the !CPA p 78,036,059.22 On domestic purchase of goods and services 773,201.00 On importation 70,280.84 � Exceptions noted by the Court 45,045,929.00 On domestic purchase of goods and services p 123,925,470.06 On importation Total excep_tions noted 124 Supra at notes 26 to 33. tl

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x------------------- ---- ----- ---- --- ---- -------- ---------------------------- ---- --- ------ --x Services rendered by Non- residents P79,455,017. 72125 The ICPA found that petitioner's input VAT arising from payments for services rendered by non-residents amounting to P79,455,017 .72 126 was duly supported by BIR form No. 1600 with corresponding proofs of payment, broken down as follows: Period Date Filed eFPS Filing Amount Reference127 Covered p 4,088,943.66 171800025200799 5,301,333.96 2018 May 10, 2018 128 171800025607680 5 ,829 ,768.05 April 171800026013476 6 ,032,380 .98 171800026391102 5 ,876,049 .24 May June 8 , 20181 29 171800026735233 5,921,702.55 171800027202608 6,041,349.09 June July 10, 2018130 171800027455853 6,301,560.89 171800028038269 12,159,215.59 July August 9, 20181 31 171900028403311 6,977,772.46 August September 6 , 2018132 171900029050221 6,654,850 .58 171900029450073 8,270,089.27 September October 10, 2018 133 171900029923396 P21,902,712.31 79,455,017.72 October November 5, 2018 134 p (1.40)1 40 November December 10, 2018135 December January 9, 2019136 2019 January February 8, 2019137 February March 6, 20191 38 March April 10, 2019139 TOTAL Per Return Difference Upon examination of the supporting documents, the Court agrees with the ICPA findings; thus , the total input VAT amount of P79,455,017.72 duly supported by documents may be validly claimed for refund. ~ 125 Item d, Par. 11 5 of Exhibit " P-2 15", Docket- Vol. III, p. 111 4. 126 Ex hi bit "P-90", USB . 127 Exhibits "P-33" to "P-44", Docket - Vo l. II, pp. 1466 to 1477. 128 Exhibit "P-2 1", Docket- Vol. II, pp. 1442 to 1443 . 129 Ex hibit " P-22", Docket - Vo l. II, pp. 1444 to 1445. 130 Exhibit "P-23 ", Docket- Vol. II, pp. 1446 to 1447. 13 1 Exhibit "P-24", Docket- Vol. II, pp. 1448 to 1449 . 132 Exhibit " P-25", Docket - Vol. II, pp. 1450 to 1451. 133 Exhibit "P-26", Docket- Vo l. II, pp. 1452 to 1453 . 134 Exhi bit " P-27'', Docket- Vo l. II, pp. 1454 to 1455. 135 Ex hibit "P-28", Docket - Vol. II, pp. 1456 to 1457. 136 Ex hi bit " P-29'', Docket - Vo l. II, pp. 1458 to 1459 . 137 Ex hib it "P-30", Docket- Vo l. II, pp. 1460 to 146 1. 138 Exhibit " P-3 1", Docket- Vol. II, pp. 1462 to 1463 . 139 Exhibit "P-32", Docket- Vo l. II, pp. 1464 to 1465 . 140 Due to ro unding off.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 57 of65 X---- ---- --- ------------- --- --- ----- --- ----- ------ ---- -- ------ ------ ------ --------- -- -- -- --X Amortized input VAT on capital goods exceeding Pl,OOO,OOO.OO for FY 2019 - P8,337,594.38.141 In support of its claim, petitioner submitted a schedule of amortization of deferred input VAT142 on its purchases of capital goods exceeding Pl,OOO ,OOO, which the ICPA evaluated. The ICPA noted that the amortized input VAT could be traced in petitioner's VAT returns, as summarized in his report. l43 According to the ICPA, there are two (2) sources of petitioner's deferred input VAT: (1) from petitioner's purchases of capital goods generated from its purchases from TY 2013 and 2014, where the supporting documents are no longer available; and, (2) from purchases of cars and computers as evidenced by BIR decisionsl 44 on petitioner's previous input VAT refund claims. However, as noted by the ICPA, no supporting documents were presented to substantiate its purchase of capital goods exceeding Pl,OOO ,OOO.OO and corroborate its amortization schedule.l45 Thus, the Court has no way to verify the existence of the said purchases of capital goods and the veracity of the computation of the said amortized input VAT. Consequently, the Court finds the disallowance �of the amortized portion of the deferred input VAT amounting to 1>8,337,594.38 in order. Input VAT on sales to government- P24,516.55146 The BIR alleged that petitioner failed to provide proof for the final withholding VAT in the amount ofP4,562.85. 141 Item e, Par. 115 of Exhi bit "P-2 15", Docket - Vol. Ill, p. 111 4. tv! 142 Exhib it "P- 165", USB. 143 Exhibit "P-2 15", Docket- Vol. III, p. I087. 144 Exhi bi t "P-1 66" to "P-1 69", USB. 145 Table 2-C, page II , Exhibit " P-1 65", US B. 146 Item f, Par. 115 of Exhibit "P-215", Docket - Vol. III, p. 1114.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 58 of65 X-------- ----------------------------------------------------------------------------------X The ICPA noted that the input VAT reported under the line item "Others"147 in the VAT returns pertain to petitioner's sales to the government amounting to P24,516.55. The ICPA's verification disclosed that only the total amount of P19,953.70 was duly supported by Certificate of Final Tax Withheld at Source (BIR Form No. 2306)1 48 and that petitioner failed to provide supporting documents on the remaining balance of P4,562.85. According to respondent, said amount should be disallowed. Moreover, petitioner is amenable to the above disallowance for P4,562.85 made by the BIR.l49 Thus, for compliance with the seventh requisite, out of the total declared input taxes of P1,685,855,716.9�o, the amount of P132,267 ,627.29 shall be disallowed. Consequently, petitioner's valid input taxes amounted to P1,553,588,089.61. Declared input taxes P78,036,059.22 P1,685,855,716.90 1. Exceptions/ disallowances 773,201.00 noted bu the !CPA 4,562 .85 ' a . Input VAT on domestic 70,280.84 78,813,823.07 45,045,929.00 purchases not properly 53,453,804 .22 supported with documents 8,337,594.38 132 ,267,627 .29 b. Input VAT on importations not duly supported with proper documentation c. Unsupported input VAT on sales to the Government 2. Disallowances found by the Court a. Unsupported input VAT on domestic purchases of goods and services b. Unsupported input VAT on importation c. Unsupported amortized input VAT on purchase of capital goods exceeding 1M Disallowances Valid input taxes Pl ,553,588,089.61 ~ 147 Line item 260, Exh ibits "P-10", "P-1 3", "P-1 7'', and "P-20", Docket- Vo l. III, pp. 1420 to 142 1, 1426 to 1427, 1434 to 143 5, and 1440 and 144 1. 148 Exhi bit "P-176", USB. 149 Page 37 of Petition for Review, Docket- Vo l. I, p. 4 1.

DECISION CTA Case No . 103 15 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 59 of65 x- --- -- ---- -- ---- ------ --- --- ----- ------- --- ---- ------ -- ----------------- ----- ---- --- ------x . Eighth requisite: A portion of the input taxes claimed by petitioner is attributable to zero-rated or effectively zero-rated sales. To reiterate, the eighth requisite is that the input VAT claimed is attributable to zero-rated or effectively zero-rated sales. However, where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes shall be proportionately allocated on the basis of sales volume. As discussed earlier, petitioner declared in its Amended Quarterly VAT returns for the period covering April 1, 2018 to March 31 , 2019 a total sales of P39,600,679,515.70 consisting ofVATable sales amounting to P2 ,539,658, 198.47, zero-rated sales amounting to P36,533,275,020.59, and exempt sales amounting to P527 ,746,296.64. It is to be noted, however, that the VATable sales amounting to P2,539 ,658,198.47 include the Sales to the Government amounting to P490,331.0Q.1 5o Since petitioner's input VAT for the FY 2019 in the total amount of P1,685,855 ,716 .90 , as declared in its quarterly VAT returns, cannot be identified to specific sales , this Court shall proportionately allocate the said input VAT on the basis of the volume of petitioner's sales, thus: Total Zero-Rated Sales per VAT Returns p 36,533,275,020.59 Divided by the Reported Total Sales per Quarterly VAT p 39,600,679 ,515.70 Returns Multiplied by Total Declared Input VAT P1,685,855,716 .90 Declared input VAT allocated to total zero-rated sales p 1,5'55,272,06,3.60 Total VATable Sales per VAT Returns P2 ,539, 167,867.47151 Divided by the Reported Total Sales per Quarterly VAT p 39,600,679,515.70 Returns Multiplied by Total Declared Input VAT P1,685,855,716.90 Declared input VAT allocated to VA Table sales p '108,095,889.21 v 150 Exhibit "P-215", Docket - Vol. III, pp. 1113 to 111 4; This amount was subjected to 5% withhol ding VAT in the amount ofP24,51 6.55. 151 P2,539,658,198.47 - P490,33 1. 00.

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 60 of65 x------ --- -- -- ----- ---- ------- -------- --- ------ ------------ --- ---- --- ----- --- -- -- --- -- --- --x VATable Sales to Government p 490,331.00 Divided by the Reported Total Sales per Quarterly VAT Returns p 39,600,679,515 .70 Multiplied by Total Declared Input VAT Declared input VAT allocated to VATable sales to the P1,685 ,855,716 .90 Government p 20,874.07 Total Exempt Sales per VAT Returns p 527,746,296.64 Divided by the Reported Total Sales per Quarterly VAT Returns p 39,600,679,515.70 Multiplied by Total Declared Input VAT Declared input VAT allocated to Exempt sales P1 ,685,855 ,716.90 p 22,466,890.02 Thus, regarding petitioner's compliance with the eighth requisite, only the amount of Pl ,555,272,063.60 represents its input VAT attributable to the total declared zero-rated for the subject period of the claim. Ninth requisite: Petitioner's input taxes have not been applied against output taxes during and in the succeeding quarters. Regarding the ninth requisite, petitioner reported output taxes from its taxable sales for the 1st to 4 th quarter of FY 2019 in the aggregate amount of P304,758,983.82, to wit: FY ending March 2019 Output VAT Exhibit (Line lSB) 1st Quarter p 51 ,39 1, 194.57 "P-1 0 "152 2nd Quarter "P-13 "153 3rd Quarter 66,487,202.13 "P-17"1 54 4th Quarter 116,180 ,073.87 "P - 2 0 "155 Total 70,700,513.25 p 304,758,983.82 In the recent case of Chevron Holdings, Inc. (Formerly Caltex Asia Limited) v. Commissioner of Internal Revenue,156 the Supreme Court held that the input tax attributable to zero-rated sales may, at the option of the VAT-registered taxpayer, be: (1) charged against output tax from regular 12o/o VAT-able sales, and any unutilized or "excess" input tax may be claimed for refund or the issuance of tax credit certificate; ' 152 Docket - Vo l. III , pp. 1420 to 142 1. ~ 153 Docket - Vo l. III , pp. 1426 to 1427. 154 Docket - Vol. III, pp. 1434 to 1435. Jss Docket- Vo l. III, pp. 1440 to 144 1. 1s6 G. R. No . 2 15 159. July 5, 2022.

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue X-------------- ---- -- -------------------- ---- -- ----- -- ---- --------- ---- -------------- -- ----X or (2) claimed for refund or tax credit in its entirety, and such option is vested with the taxpayer-claimant, to wit: "Thus, the input tax attributable to zero-rated sales may, at the option of the VAT-registered taxpayer, be: (1) charged against output tax from regular 12% VAT-able sales, and any unutilized or "excess" input tax may be claimed for refund of the issuance of tax credit certificate ; or (2) claimed for refund or tax credit in its entirety. It must be stressed that the remedies of charging the input tax against the output tax and applying for a refund or tax credit are alternative and cumulative. Furthermore, the option is vested with the taxpayer-claimant." [Emphasis supplied] Applying the foregoing, records show that petitioner chose the first option, i.e., it computed its claim for refund in the aggregate amount of P1,381,096,733.07 by offsetting its output VAT from the regular VATable sales against its available input VAT for the 1 st to 4 th quarters of FY ending March 2019, as shown hereafter:l57 Output VAT Due (A) p 304,758,983.82 Input Tax on Net Current P1,677,493 ,605.96 Purchases Add: Input Tax Deferred on 44,300 ,909.29 Capital Goods Exceeding P1M 24,516.55 from Previous Quarter 35,963,314.91 Add: Withholding VAT on Payments to GOCCs 1,685,855, 716 .89 Less: Input Tax on Purchases of P1,381,096,733.07 Capital Goods Exceeding P1M deferred for the succeeding period Input VAT per Return (B) Excess and Unutilized Input VAT (A-B) It is clear from the foregoing that petitioner opted to claim a refund of its unutilized or "excess" input tax, which is the amount after charging the input tax allocated to zero- rated sales against its output tax liabilities. Following the same computation, since petitioner's declared input VAT allocated to sales subject to the 12�/o VAT in the amount of P108,095,889.21, as earlier determined, is not enough to cover its output VAT liability amounting to P304,758,983.82, the output VAT still due amounting to 157 Exhibit "P-215", Docket - Vol. III, p. 1482 . ~

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue x---- ---- -- -- ---------- ------- ------- -------- -- -- --- -------- -- -- ---- ---- ----- ----- --- ---- --x P196,604,254.89 shall then be charged against its valid input VAT attributable to total reported zero-rated sales of Pl ,555,272,063.60 leaving an excess input VAT attributable to total zero-rated sales of Pl ,358,667,808.71, as herein computed: Output VAT attributable to VATable Sales p 304,758,983.82 Less: Output VAT to government sales (58,839 .72) Adjusted output VAT Less : Declared input VAT attributable to p 304,700,144.10 VATable sales (108,09' 5 ,889.21) Out_eut VAT still due p 196,604,254.89 Output VAT still due p 196,604,254.89 Less: Declared Input VAT attributable to Zero- 1,555,272,063.60 p 1,358,667,808. 71 rated Sales Excess input VAT attributable to declared zero-rated sales However, as discussed earlier, not all petitioner's input VAT is valid. Thus, this Court determines whether the valid input VAT of petitioner is sufficient to cover its excess input VAT attributable to declared zero-rated sales, viz.: Excess input VAT attributable to declared p 1,358,667,808.71 zero-rated sales (A) 1,553,588,089 .61 Valid input taxes (B) p 1,358,667,808.71 Valid Available Input VAT attributable to Zero-rated Sales (A or B, whichever is lower} In relation to its zero-rated sales, petitioner was able to properly substantiate only the total amount of P36,499,857,975.17 out of its total declared zero-rated sales of P36,533,275,022.09. Consequently, only the input VAT of Pl ,357,425,033.02 is attributable to the said valid zero-rated sales of P36,499 ,857,975.17, as computed below: Valid Zero-rated Sales p 36,499 ,857 ,975.17 Total Zero-rated Sales 36,533 ,275 ,022.09 Ratio of Valid Zero-rated Sales to Total Zero-Rated Sales 99.91 % Valid Input VAT attributable to Valid Zero- rated Sales 1,358,667,808 .71 Total Net Refundable Amount p 1,357,425,033.02 Further, although petitioner carried over the claimed amount of P1 ,381,096,733.07 in its succeeding ~

DECISION CTA Case No . 10315 Dole Philippines , Inc . v. Commissioner of Internal Revenue Page 63 of65 x-- ----- -- ---- -------- -- ----------------------- ---- -- ---- ---- -- -- -- ------- ---- --- -- --- --- --x quarters/period, the same remained unutilized until it was deducted as "VAT Refund/TCC claimed"158 in its Quarterly VAT Return for the 2nd quarter ofFY ending September 2019, albeit, only in the amount of P1,358,809 ,685.73, since the discrepancy of which amounting to P22,287,047.35 159 pertains to input VAT allocable to exempt sales which was already deducted and does not anymore form part of petitioner's allowable input tax to be carried over, as disclosed in its VAT Returns for the 1st to 4th quarters of FY ending March 2019. Accordingly, the subject claim no longer formed part of the excess input VAT of P418 , 175, 190.04160' as of the end of the 2nd quarter of FY ending September 2019 , to be carried over to the succeeding quarters. Such being the case, the excess valid input VAT of P1,357 ,425 ,033.02 was not utilized or applied against any output tax liability during the 3rd quarter of FY 2019 and in the succeeding quarters.l61 In fine, petitioner was able to satisfy the ninth requisite and has sufficiently proven its entitlement to the refund or issuance of TCC for P1,357,425,033.02, representing its excess and unutilized input VAT attributable to its zero-rated sales for the 1st to 4 th quarters of FY ending March 20 19. Final note An applicant for a tax refund or credit must prove entitlement to the claim and comply with all the documentary and evidentiary requirements, such as VAT invoicing requirements, provided by tax laws and regulations. 162 Well- settled is the rule that tax refunds or credits, just like tax exemptions, are strictly construed against the taxpayer. The v- burden is on the taxpayer to show that he has strictly complied with the conditions for the grant of the tax refund or credit.163 158 Ex hibit "P-45", Line 23D, Docket- Vol. III, p. 1479. 159 FY ending Input Tax a llocable Ex hibit (Line 23C) to Exempt Sales Ma rch 2018 p 4,256,3 52. 18 "P-10" , Docket- Vol. III, pp. 1420 to 142 1 "P-13 ", Docket - Vol. III, pp. 1426 to 1427 I st Quarter 5,204,779 .36 2nd Quarter 3rd Quarter 6,90 5,227.70 "P-17" Docket- Vol. III, pp. 1434 to 1435 4th Quarter 5,920,688 .11 "P-20" , Docket- Vol. III, pp. 1420 to 142 1 Tota l P22 ,287 ,047 .35 160 Exhibit "P-45", Li ne 29, Docket - Vo l. III, pp. 1478 to 1479; Exhibit "P-1 27", USB. 161 Ex hibits "P-1 28"and " P-1 29", USB. 162 Philippine Gold Processing and Refining Corp. v. Commissioner ofInternal Revenue, G.R. No. 222904 (Notice), Ju ly 15, 2020 . 163 Commissioner ofInternal Revenue v. San Roque Power Corp., G.R. Nos. 187485, 196 11 3 & 197 156, 12 February 20 13, 703 SCRA 310-434

DECISION CTA Case No . 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 64 of65 x------------------------------------------ ------ ------ ---- --- ------------------- ---- ------x However, once the requirements laid down by the NIRC have been met, a claimant should be considered sucessful in discharging its burden of proving its right to a refund. Thereafter, the burden of going forward with the evidence, as distinct from the general burden of proof, shifts to the opposing party, the respondent. It is then the turn of the latter to disprove the claim by presenting contrary evidence. 164 WHEREFORE, in light of the foregoing, the instant Petition for Review is PARTIALLY GRANTED. Accordingly, respondent is ORDERED to refund or issue a tax credit certificate in favor of petitioner in the amount of P1,357,425,033.02, representing petitioner's excess and unutilized input VAT attributable to its zero-rated sales for the first to fourth quarters of FY ending March 20 19. SO ORDERED. k~JA~t LA~~fVl.' cui~AVID Associate Justice WE CONCUR: 0 Presiding Justice .. \ JEANMA 164 Winebrenner & liiigo Insurance Brokers, Inc. v. Commissioner of Internal Revenue, G.R. No. 206526, January 28, 2015, 75 2 SCRA 375-412 .

DECISION CTA Case No. 10315 Dole Philippines, Inc. v. Commissioner of Internal Revenue Page 65 of65 X---------------------------------------------------- ------------- ------------ -------------X ATTESTATION I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. ' s Special 2nd ~sian Acting Chrurperson CERTIFICATION Pursuant to Article VIII, Section 13 of the Constitution, and the Special 2nd Division Acting Chairperson's Attestation, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court's Division. 0 Presiding Justice w